HC Deb 22 March 1973 vol 853 cc649-50
24. Mr. David Mitchell

asked the Chancellor of the Exchequer whether he will arrange for VAT-registered small traders who have difficulty in producing quarterly returns to be enabled to make estimated VAT payments quarterly, fully and properly adjusted at the time of their annual audit.

Mr. Higgins

There is no provision in the Finance Act 1972 for traders to make estimated payments of VAT each quarter. Customs and Excise will be reviewing the operation of VAT in the light of practical experience and my hon. Friend's suggestion will be borne in mind.

Mr. Mitchell

In view of the high administrative cost of VAT, particularly to small traders, will my hon. Friend bear in mind that anything he can do of this nature to help the small business trading community will be welcomed by it?

Mr. Higgins

I do not accept that these costs are high. Small traders, by our £5,000 taxable turnover limits, will be exempt. The whole basis on which we have provided the machinery—after widespread and extensive consultations—has been to cut the administrative burden to the minimum. We have looked carefully at my hon. Friend's proposal. Although at first glance it appears to offer a significant reduction, on detailed examination it reveals considerable difficulties—but we will bear it in mind.

Mr. Joel Barnett

Does the Financial Secretary still intend to penalise the small traders who, because they did not understand his complicated tax, were not able to register? Does he intend that they shall not receive a rebate of purchase tax on stocks?

Mr. Higgins

There are provisions lor rebate of tax for those who are registered. The hon. Gentleman has a Question on the Order Paper which is unlikely to be reached. The answer gives a full explanation of the present situation. There is no reason to suppose that the tax cannot go ahead on schedule and as planned.