§ Mr. Neil Hamiltonasked the Chancellor of the Exchequer what is the average number of man-hours estimated to be spent by a registered trader with a turnover of less than £50,000 per annum in the completion of his value added tax returns.
§ Mr. HayhoeThis information is not available from official sources.
13W
§ Sir Hugh Rossiasked the Chancellor of the Exchequer what is the annual amount of revenue produced by value added tax on repairs to (a) ordinary residential accommodation and (b) listed buildings.
§ Mr. Hayhoe(a) It is estimated that the revenue from value added tax on housing repairs, including materials used by occupiers, is about £425 million a year. This will include some expenditure on listed buildings which are used as ordinary residential accommodation.
(b) I regret that information from which to make a separate estimate is not available.
§ Sir Hugh Rossiasked the Chancellor of the Exchequer whether he is satisfied with the operation of the distinction between repairs and new construction work for value added tax purposes; and how many civil servants are currently engaged in ensuring the distinction is properly applied by builders.
§ Mr. HayhoeNew construction is generally zero rated for VAT purposes while repairs are standard rated. If there were no distinction, the administration of the tax would be eased: but ease of administration, although very important, is not the only factor relevant to the coverage of the tax. Checking that the distinction is being properly applied by builders is only a part of the duties of Customs and Excise control visiting staff, and a realistic estimate of the time devoted to this aspect of their work could be obtained only at disproportionate expense.
§ Mr. Sheltonasked the Chancellor of the Exchequer whether he will make a statement on the practice of Her Majesty's Customs and Excise of recovering the costs incurred in levying distress or poinding for unpaid value added tax.
§ Mr. HayhoeYes. Under regulation 58 of the Value Added Tax (General) Regulations 1980, the cost of levying distress for unpaid value added tax in England, Wales and Northern Ireland falls on the person owing the tax, and may be recovered from him either directly, or out of the proceeds of the sale of the distress. Regulation 59 provides for sheriff officers who poind for unpaid VAT on behalf of the Customs and Excise in Scotland to collect 10 per cent of the value of the goods involved to cover their costs. Recent legal opinion has cast doubt on the vires of the relevant parts of these two regulations and until the position has been clarified Customs and Excise have decided to suspend the collection of costs of levying distress and poinding. The Government intend to propose legislation in the next Finance Bill to amend schedule 7 to the Value Added Tax Act 1983 so as to make it clear that the power to make regulations providing for the recovery of unpaid VAT extends to the recovery of costs incurred.
Similar action is being taken in relation to the recovery of unpaid car tax under the Car Tax Act 1983.