HC Deb 25 March 1983 vol 39 cc498-9W
Mr. Richard Page

asked the Chancellor of the Exchequer whether, further to his statement of 19 July 1982 concerning value added tax zero rated alteration services supplied by the construction industry, Official Report, Vol. 28, c. 43–44, he will make a statement on the judgment of the Court of Appeal in the case of Commissioners of Customs and Excise v. Viva Gas Appliances Ltd.

Mr. Bruce-Gardyne

Judgment was given for the commissioners on 22 March and is now being carefully considered.

Mr. Nelson

asked the Chancellor of the Exchequer what representations he has received about the new partial exemption de minimis rules for value added tax purposes; and if he will make a statement.

Mr. Bruce-Gardyne

Yes. The new rules, which were made in the VAT (General) (Amendment) Regulations 1983 (S.I. 1983, 295) were designated by the Commissioners of Customs and Excise to

  1. (a) revalorise the existing de minimis monetary limits for smaller businesses which were last reviewed in 1978; and
  2. (b) impose new monetary ceilings in order to ensure that the de minimis rules do not continue to be used for the recovery of substantial amounts of input tax in respect of exempt activities in a way for which the rules were never designed.

I have received a number of representations about the need for consultation regarding the impact of these new monetary ceilings on the larger partly exempt traders. In the light of these representations I have asked the commissioners to withdraw the provision for these ceilings so that consultations can first take place. The rest of the statutory instrument, including that which relates to revalorisation, is not affected.

The commissioners will be laying the necessary amendments to regulation 27(2) and 27(3) forthwith.