§ Mr. Maclennanasked the Chancellor of the Exchequer, further to his reply to the hon. Member for Caithness and Sutherland of 2 July, Official Report, c. 477, why he does not think it would be a practical proposition to exempt from value added tax petrol and diesel sold in the Scottish islands.
§ Mr. Peter Rees[pursuant to his reply, 16 July 1981]: It would be difficult to confine any such scheme of relief from VAT to the Scottish islands ahead of similar claims from other remote areas of the United Kingdom—including some rural mainland areas. To concede all, or even many, of such claims would lead to distortion in the pattern of trade and encourage evasion and abuse. It would have serious implications for the policing of the VAT system.