§ Mr. TimmsTo ask the Chancellor of the Exchequer what factors underlay the lower than projected yield of value added tax in 1995–96. [37667]
§ Mrs. Angela KnightThe matter is currently being looked at by a working group comprised of officials from HM Treasury and HM Customs and Excise. The probability is that there is no single explanation, but a range of contributory factors. Receipts for the first quarter of 1996–97 are showing healthy growth.
§ Mr. SalmondTo ask the Chancellor of the Exchequer (1) what plans he has to ensure the consistency of his proposals with EU law for a retrospective limitation on claims for recovery of value added tax as a result of a customs mistake; [39604]
(2) what plans he has to ensure the legitimate expectations of taxpayers in respect of repayment of VAT are met; and if he will make a statement; [39605]
539W(3) what considerations led to the setting of (a) the statutory limitation period for customs recovery of value added tax and (b) the proposal for the period regarding taxpayers recovery; and if he will make a statement. [39603]
§ Mr. WaldegraveThere are no harmonised European Community rules applying to recovery of overpaid VAT. Member states are free to determine their own procedures for claims provided that they respect Community law principles. National time limits for VAT—which operate within an EC framework—cannot be less favourable than those applying for similar domestic taxes, and procedures must not make it excessively difficult for a taxpayer to exercise his Community rights.
The new three-year cap on retrospective refunds of VAT will apply to all the indirect taxes and duties administered by customs. EC law already imposes a three-year limit in respect of repayment of customs duty.
A three-year time limit on refunds achieves a proper balance between the rights of individual taxpayers and the public interest. The Government have become concerned at the increasing amounts of revenue at risk in taxation boundary disputes, in some cases back to the introduction of VAT in 1973. A three-year limit will introduce certainty both for taxpayers and the Exchequer, and is proportionate in effect because, at the time of the relevant transactions, both taxpayers and their customers will normally have worked on the assumption that the tax was due.
§ Mrs. CurrieTo ask the Chancellor of the Exchequer how many new registrations for VAT there were in South Derbyshire in each of the last five years. [39758]
§ Mr. WaldegraveCustoms does not have information concerning the number of new registrations in South Derbyshire alone. The local VAT office at Derby covers, in addition to South Derbyshire, parts of Leicestershire and Staffordshire. The number of VAT registrations for that area in the last five calendar years is as follows:
year New registrations 1991 1,869 1992 1,805 1993 1,900 1994 1,670 1995 1,766 1996 (to 30 June 1996) 1000