§ 2.46 p.m.
§ Lord Graham of EdmontonMy Lords, I beg leave to ask the Question standing in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government whether they have any plans to remove VAT from funeral costs.
§ Lord Brabazon of TaraMy Lords, the services of funeral undertakers are already exempt from value added tax. The Government have no plans to extend the existing relief.
§ Lord Graham of EdmontonMy Lords, I thank the noble Lord for that reply. However, is he aware that, following the latest imposition of VAT on newspaper obituary notices, funeral furnishing costs for coffins, fittings, floral tributes, motor expenses and monumental inscriptions add to the list of funeral charges that bear VAT? Is the noble Lord aware that the death grant of £30—the woefully inadequate death grant—is exceeded by the amount of VAT that the Treasury claws back? When will the Government increase the death grant or abolish VAT, or preferably do both?
§ Lord Brabazon of TaraMy Lords, VAT exemption associated with burials and cremations applies to the services of the undertaker, including making arrangements for cremation or burial, disposal of ashes, transport, the supply of the coffin and associated goods. However, as the noble Lord says, it does not cover discretionary expenditure on flowers, wreaths, gravestones and other items. Successive Governments have looked at this matter since 1973 and have decided not to extend the relief. The death grant is under review in the current social security review, and noble Lords will have to await the outcome of that.