HC Deb 19 May 1975 vol 892 cc283-5W
Mr. Welsh

asked the Chancellor of the Exchequer how many individual VAT returns are received annually; and what percentage is rejected or reviewed.

Dr. Gilbert

Some 5½ million VAT returns are received annually and all are subject to review on receipt. Some 9 per cent. of the returns are currently being returned to the registered person for amendment.

Mr. Welsh

asked the Chancellor of the Exchequer how many official individual documents and pamphlets have been issued concerning VAT since its inception; and how many VAT regulations have been issued since its introduction.

Dr. Gilbert

There are numerous different kinds of official documents and pamphlets concerning VAT, and copies of them may be issued centrally or from local Customs and Excise offices. No accurate estimate can be made of the total number of individual copies issued since the introduction of VAT. Since the passing of the Finance Act 1972, 59 statutory instruments concerning VAT have been made, 11 of which were regulations. In a number of cases an instrument consolidated or superseded earlier instruments.

Mr. Trotter

asked the Chancellor of the Exchequer what is his estimate of the extra annual cost of administering VAT due to the recent introduction of a higher rate on certain items.

Dr. Gilbert

I will let the hon. Member have a reply as soon as possible.

Mr. R. C. Mitchell

asked the Chancellor of the Exchequer under what contractual arrangements the 25 per cent. VAT rate is payable on existing television rental contracts; and if he will make a statement.

Dr. Gilbert

The renting of a television set is a taxable supply of goods for VAT purposes. By virtue of Sections 5 and 7 of the Finance Act 1972 and regulations made under the latter section, VAT becomes chargeable at the time of each invoice under a rental contract, or at the time of each payment if an invoice does not precede the payment, and the rate chargeable at each such time is the rate in force at that time, no matter when the contract was originally made. For invoices or payments on or after 1st May 1975 the rate in force is 25 per cent.

The tax falls upon the television rental companies and nothing in the VAT legislation obliges them to pass on any increase or decrease to a customer if the rental contract provides otherwise, but Section 42 of the 1972 Act requires that contract prices should be adjusted to take account of changes in the rate of VAT unless there is contrary provision in the contract.

Mr. Clemitson

asked the Chancellor of the Exchequer how much revenue it is anticipated will accrue in the forthcoming financial year from the imposition of the new 25 per cent. rate of VAT on television rental agreements entered into before 15th April 1975.

Dr. Gilbert

I will let my hon. Friend have a reply as soon as possible.