§ Mr. Gerald Bowdenasked the Chancellor of the Exchequer if he will make a statement on the current position on the difference of view between the European Community Commission and Her Majesty's Government regarding the zero rating of certain goods and services.
§ Mr. BrookeThe EC Commission has applied to the European Court of Justice for a declaration against the United Kingdom that the zero rating of certain goods and services is incompatible with the sixth VAT directive, as not being for clearly defined social reasons or for the benefit of the final consumer. The Government do not accept this contention and will defend the issue before the European Court. It is unlikely that the case will be heard, at the earliest, before the end of the year.
§ Mr. Foulkesasked the Chancellor of the Exchequer, if he will list for each country in the European Economic Community the percentage value added tax take-up entailed by the budget approved by the Council of Ministers.
§ Mr. BrookeI shall let the hon. Member have a reply as soon as possible.
§ Mr. Michael Brownasked the Chancellor of the Exchequer what was the total revenue generated by value added tax and duty on tobacco products in the last full year for which figures are available; and what proportion this represented of total value added tax receipts.
§ Mr. BrookeThe excise duties on tobacco products yielded some £4,340 million in the calendar year 1985. It is estimated that the related value added tax was of the order of £910 million. This total of £5.25 billion is equivalent to 26 per cent. of the total net receipts of value added tax in the same period.