§ Mr. Bishopasked the Chancellor of the Exchequer (1) to what extent charitable organisations concerned with the disabled now pay purchase tax and selective employment tax; whether such bodies will be exempt from value added tax; or what rate of tax will be payable;
(2) to what extent charitable organisations concerned with the mentally handicapped now pay purchase tax and selective employment tax; whether such bodies will be exempt from the value added tax; or what rate of tax will be payable.
§ Mr. HigginsCharities concerned with the disabled and mentally handicapped bear purchase tax on their purchases of chargeable goods in the same way as non-charitable organisations. SET also enters into the price of purchased goods and services. They also pay selective employment tax for their employees but these payments can be refunded.
Many of these charities will be exempt from value added tax because their activities are among those specifically exempted or because their turnover from taxable activities does not exceed £5,000 a year. Others will be liable for the standard rate of VAT on certain of their activities.