HC Deb 20 April 1994 vol 241 cc515-6W
Mr. Betts

To ask the Chancellor of the Exchequer what considerations led him to apply differential treatment to individual and district heating systems in regard to the levying of VAT on domestic fuel.

Sir John Cope

There is no special VAT treatment for supplies of heat made under a district heating scheme. However, where landlords supply their tenants with heat under such a scheme and make a flat rate charge for both accommodation and heat then, in VAT terms, there is only a single supply of heated accommodation. In such cases the VAT liability of this single supply will be determined by the principal element, the accommodation. This has always been the position and follows established VAT supply principles.

Mr. Martyn Jones

To ask the Chancellor of the Exchequer what estimate he has made of the extent to which value added tax will be charged on any fuel used before 1 April, in bills sent out shortly after 1 April; and if he will make a statement.

Sir John Cope

There are transitional arrangements that enable suppliers to apportion bills so that VAT is charged only on gas and electricity calculated as used after the new rate came into force.

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