HC Deb 26 November 1973 vol 865 cc66-7W
Miss Quennell

asked the Chancellor of the Exchequer whether combine harvesters are exempt from value added tax, or the usual vehicular taxes ; and what are the reasons for the present arrangement.

Mr. Higgins

Combine harvesters are taxed at the standard rate of VAT, but registered taxable persons are able to recover the tax through the credit mechanism of the VAT system. Combine harvesters are not exempt from vehicle excise duty, but they pay the preferential rate of £5 a year duty applicable to agricultural machines because of their low annual mileage on public roads and the severe limitations which are put on their use. The fuel used is gas oil, dutiable at the rebated rate of 1p per gallon which applies to heavy oils used otherwise than as road fuel.