Ever in the desire to bring both my readers the news that really matters, I could not pass on a report in today’s Independent regarding lapdancers and VAT liability.
Apparently the lapdancing chain, Spearmint Rhino, has been in dispute with HM Revenue and Customs over who is liable for any VAT (Value Added Tax) liability on the activities of the “exotic” dancers working at their establishments. A High Court judgment has just ruled that the liability falls upon the dancer.
Explaining his ruling, Mr Justice Mann described the financial transaction in the business of dancers gyrating semi-naked round a pole for money: "A fee of £10 is charged for a semi-nude dance; £20 is charged for a nude dance. The dance is arranged as between the dancer and customer. In addition to those services, the dancer and the customer can agree what is called a 'sit down'. For £250 (a sum which is in fact negotiable) a woman can be engaged to sit and socialise with the customer for an hour." (I wonder how much field research the good justice did…in the interests of ensuring the law was correctly applied of course!)
He described the Spearmint Rhino club in Tottenham Court Road, London, as a "typical example" of a lapdancing venue (requiring one or more visits to the club, also to a number of others for benchmarking purposes I presume…). He said: "A member of the public pays £8 for admission and on entering goes into an area in which he/she may drink, socialise, eat and watch partially clad women dancing on a podium.” (but mainly to watch partially clad women dancing on a podium, you can get the other stuff and any good bar or restaurant)
David Milne QC, representing Spearmint Rhino, had told Mr Justice Mann that the dancer has to pay the club for the facilities she uses and there was no contract between the club and the men she "entertained". Mr Justice Mann he agreed with Spearmint Rhino's case - the operation at the clubs tended to suggest that the dancers are performers "plying their self-employed trade at the club in their own right".
I can’t see HMRC accepting that that lap dancing is an educational or medical service, and thus exempt from VAT. However, the current threshold for compulsory VAT registration is £61000, so any lap dancer earning below this amount (I would have thought that was most of them) would not be forced to register. By doing so theywould be able to offset any input tax suffered against their liabilty but I really can’t see the VAT charged on the purchase of g-strings adding up to very much. Perhaps the biggest biggest problem is going to be where the dancers going to put their invoice pads….
Hmm this post really did seem like a good idea when I started it…
12 comments:
American men would probably be loathe to see what the stable of dancers at a place called The Spearmint Rhino looks like. I mean, are we talking Rosie O'Donnell look alikes clad in thong bikinis chomping on some Wrigley's gum?
Pole tax is an outrage anyway. I heard that Santa Claus is the secret owner of Ho Ho Ho Club up in the North Pole and will have to pay double the pole tax for having pole dancers in the Pole. Poles dancing around a pole in Poland face similar taxations.
Oh, and Houston has a city ordinance prohibiting lewd and lascivious acts. Supposedly you have to keep a distance of a foot away from the dancer or some measurement like that. Which inspires the strip club transaction of "Is that a ruler in your pocket, or are you just happy to see me?"
Here's a story very similar:
Go to slatedotcom and search Nampa nude dancing and you'll find an interesting piece. What is the best thing about this article is the actual court documents :)
i guess i didn't understand- perhaps because i was giggling too much at your asides :) the dancers are going to have to pay tax on what? they are considered independent contractors working within the club's building? does that mean something like our quarterly income taxes here for the self employed? i can imagine explaining the 'research' to my wife if i was the magistrate :)
EWBL, you neglected to mention that in Houston, such places are legally designated "sexually oriented businesses" ... S.O.B.'s. And the city ordinances regulating them are casually called the S.O.B. laws. And sometimes taxes like your VAT on such businesses are referred to as "sin tax" (pronounced just like "syntax").
Even in my younger years, I never quite saw the fascination in "socializing" with a nude woman one doesn't know and legally may not get to know, and away from whom one had to keep a legally specified distance. But maybe I'm missing something.
Hmm Ewbl, I daresay there would be some who would pay good money to see a 300lb woman (or man) gyrate on a Pole.... ir a lituanian or a Czech for that matter.
Do you mean that Ho, ho, ho indicates Santa has a voracious appetite for prostitutes.. you've made me lose faith in Father Christmas nowm dammit!!!!!
LOL again ewbl.. Sadly most men would be arrested in such circumstances - Almost every man dreams of a foot long - sub that is, with added pickle. Oh hell when in an innuendo hole keep on digging!
Thanbks Elizabeth I will have to have a look. Sometimes I wonder if people can keep a straight face when dealing with such things.
Betmo, at the end the gitls are deemed to be self employed and thus responsible for all tax payments. VAT is a sort of sales tax. The ruling is as dull as ditchwater but I couldnt help think of the the research teh judge would have to do to make those statements.. It simply is not the sort of thing one can delegate!
To be honest Steve it's never really appealed to me... Expensive beer, greasy food and greasy entertainment (in the Trailer Park Boys meaning of greasy).. It;s really just sleazy window shopping in my view...
The taxman cometh and killeth all fun.
in this case the taxman killeth 7/47ths of the fun anyway!
My Papi never understood the appeal of porn and 'gentleman's clubs,' either because he said he'd rather have the real thing up close and personal and not just pay to look. I'd like to think that was an expression of love for me, his wife, and not an endorsement of prostitution.
WHen all is said and done. sex is like cricket... Great fun to play but boring as hell to watch!
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