§ 19. Mr. Heddleasked the Chancellor of the Exchequer if he will publish the Government's defence in respect of the infraction proceedings under the European Economic Community sixth directive on value added tax on new building.
§ Mr. BrookeNo. In accordance with the normal practice in infraction proceedings we do not propose to publish our defence in the zero rates case.
§ 22. Mr. Thurnhamasked the Chancellor of the Exchequer what recent representations he has received about the collection of value added tax from small businesses; and if he will make a statement.
§ Mr. BrookeWe have received a number of representations covering the whole range of value added tax. I welcome the recent publication by Her Majesty's Customs and Excise of a consultation paper "VAT: Small Business Review" which contains a package of proposals to help small businesses.
I am anxious to press on with these proposals and am therefore asking for all comments to be sent to Customs by 31 December so that decisions can be taken in good time for the 1987 Finance Bill.
§ 24. Mr. Patchettasked the Chancellor of the Exchequer if he will review the operation of the penalties contained in the Finance Act 1985 concerning value added tax; and if he will make a statement.
§ Mr. BrookeYes. The White Paper "Building Businesses … Not Barriers" (Cmnd. 9794) contains a commitment to review the penalties before the 1988 Budget, after a full year's practical experience.
§ 33. Mr. Maddenasked the Chancellor of the Exchequer what progress he has made in securing more flexibility in setting the value added tax threshold.
§ Mr. BrookeOn 9 October 1986, the European Commission submitted to the Council of Ministers a draft directive proposing a VAT scheme to apply to small and medium sized businesses. One of the proposals in the directive is for an optional maximum threshold of 35 000 ecu (about £25,000).