§ Sir John Farrasked the Chancellor of the Exchequer what representations he has received from firms in the knitting industry objecting to the new measures in regard to the collection of value added tax; and what assessment he has made of the implications of these new arrangements for the viability of the firms concerned.
§ Mr. BrookeI have received one such representation, which referred to the default surcharge to be imposed on those persistently late with their VAT returns and payments. The VAT accounting arrangements, which have not been changed, permit for between one and four months before tax charged has to be remitted to Customs and Excise. Many traders derive a cash flow benefit from this. The Government are, however, conscious of the problems faced by firms whose cutomers are dilatory in paying their bills and are to publish "Notes for Guidance to Buyers and Sellers" later this month. These will emphasise that terms for payment should be agreed in advance and stress that payment should then be made within the agreed period.