§ Mr. Moate
asked the Chancellor of the Exchequer what constraints have been accepted by Her Majesty's Government under EEC rules on their freedom to zero-rate for value added tax purposes any additional items or range of items.
§ Mr. Robert Sheldon
The EEC Sixth Council directive on VAT was signed by Ministers of the nine member States in May 1977 and changes in United Kingdom law necessitated by the directive came into operation in the United Kingdom on 1 January 1978. The directive allows the United Kingdom to retain those zero-rated reliefs which were in force on 31 December 1975 and which were pro-50W vided for clearly defined social reasons and for the benefit of the final consumer, until a date fixed unanimously by the Council of the EEC, subject to that date being not later than the abolition of fiscal frontiers between the member States. The Council is required to review these reliefs every five years but any changes can be made only by the Council acting unanimously. The United Kingdom continues meanwhile to have the discretion to make marginal adjustments to the scope of existing zero-rated reliefs.