§ Mr. Wallasked the Secretary for State of Defence what amount of value added tax has been paid on the building of HMS "Invincible", HMS "Illustrious", and HMS "Ark Royal", respectively.
§ Mr. GoodhartShip construction costs do not attract VAT. However, the tax is incurred on weapons systems and equipments supplied by the Ministry of Defence to the shipbuilder.
The VAT element of the total cost of HMS "Invincible", which was completed last year, was £2.4 million. To the end of February 1981, the date of the latest available records, VAT incurred on HMS "Illustrious" and HMS "Ark Royal", both of which are being fitted out, was £3.9 million and £2.5 million respectively.