§ Mr. David Steelasked the Chancellor of the Exchequer what are the grounds for the extension of value added tax liability to include entry fees on competitions which have not been subject to such liability since the introduction of value added tax in 1973.
§ Mr. Peter ReesOriginally in 1973 the Commissioners of Customs and Excise took the view that competition entry fees were generally outside the scope of VAT. More recently they reached the conclusion that their early view was wrong as a matter of law. This conclusion has been confirmed by the independent VAT tribunals in two recent cases. The commissioners, who have statutory responsibility for the care and management of the tax, had no option but to announce their change of ruling so that tax which was properly due could be collected for the future. This they did by press notice on 7 August 1980, but they allowed sports and other organisations reasonable time to adust to the change by making the ruling effective from 1 January 1981.
§ Mr. Onslowasked the Chancellor of the Exchequer if he will list the EEC member countries which currently apply value added tax to entry fees for all sporting events.
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§ Mr. Peter ReesI regret that full information is not immediately available. I shall make inquiries and write to my hon. Friend.