§ Mr. Heddleasked the Chancellor of the Exchequer if the Government's position on the question of the imposition of value added tax on non-domestic construction work remains unaltered since 29 February.
§ Mr. HayhoeYes. The EC Commission has now issued a reasoned opinion under article 169 of the Treaty of Rome alleging that certain aspects of the VAT zero rates in force in the United Kingdom including those applicable to non-domestic construction are contrary to the provisions of the sixth VAT directive. The United Kingdom Government have made it clear that they do not accept the Commission's views.
§ Mr. Gryllsasked the Chancellor of the Exchequer what representations he has received concerning the operation of the Value Added Tax (General) (Amendment) (No. 2) Regulations 1984 as it relates to the Post Office's Datapost service and the services operated by international air courier companies.
§ Mr. HayhoeTwo trade associations representing international air couriers and freight forwarders have written to or had meetings with Customs and Excise seeking parity of treatment with the Post Office's Datapost service.
§ Mr. Meacherasked the Chancellor of the Exchequer if he will take steps to ensure that both plain water, as supplied in hospitals for new-born babies, and dextrose solutions, as supplied for the same purposes, are both zero-rated for value added tax purposes; and if he will make a statement.
§ Mr. HayhoeNo. Purified bottled water and dextrose solutions are both taxable at the standard rate. Supplies to patients in hospitals are exempt from the tax. With certain limited exceptions, the VAT charged on supplies of goods and services to the Health Service cannot be reclaimed. But the allocation of funds to the Health Service takes the incidence of VAT fully into account.