§ Mr. Matthew Banks
To ask the Chancellor of the Exchequer if the law on VAT group registration is to be changed, and if he will make a statement.
§ Mr. Heathcoat-Amory
I have asked Customs and Excise to review the current provisions on VAT group registration and report to me by the early summer with a view to including any necessary changes in next year's Finance Bill. However, following a recent VAT tribunal decision, I have decided to propose some changes in the law immediately to prevent continuing tax losses by manipulation of the current provisions for tax avoidance purposes. The new clause will be tabled in the course of this year's Finance Bill. The clause, if approved, will have effect as from midnight tonight.
Customs and Excise will be issuing a press notice, together with a draft of the clause, today. Copies will be placed in the Library of the House.