§ Mr. WarrenTo ask the Chancellor of the Exchequer why he introduced value added tax on components supplied for multinational defence programmes; and if he will make a statement.
§ Mr. Lilley[holding answer 28 November 1988]: There has been no change in the VAT treatment of such programmes. Although there is no general relief for defence projects, components for international defence projects may be relieved of tax if they are exported or, in broad terms, if they are supplied by or to overseas bodies under arrangements that incorporate formal intergovernmental agreement to waive tax. If my hon. Friend has a particular point in mind, he is of course welcome to write me.