§ Mr. Alfred Morrisasked the Chancellor of the Exchequer what consideration he is giving to the letter about value added tax from the Spastics Society of 19 March and six other major charities, a copy of which has been sent to him by the right hon. Member for Manchester, Wythenshawe; what action he is taking; and if he will make a statement.
§ Sir Geoffrey HoweThe letter was written under a misapprehension about the effect of the Value Added Tax (Handicapped Persons and Charities) Order 1981. These charities did not appreciate that item 5 of the revised group 16 of schedule 4 to the Finance Act 1972 zero-rates all purchases of ambulances and wheelchairs by charitable institutions providing care for the handicapped. I have sent to the right hon. Member a copy of the letter my hon. and learned Friend the Minister of State, Treasury has written informing them of the correct position.