Value Added Tax (Hansard, 24 March 1988)

§ Mr. Spearing

To ask the Chancellor of the Exchequer if he will tabulate in theOfficial Report those commodities formerly, or currently, subject to zero value added tax rating, including all those in groups 1 to 17 listed in his note to the Select Committee on the Treasury and Civil Service and published by it on page 8 of its third report of Session 1987–88, (HC 248), in five separate tables to show items that (a) were zero-rated by Her Majesty's Government but have subsequently had their zero-rated status changed by virtue of actions taken, or requests made, by either the Court or the Commission of the European Economic Communities, (b) items currently the subject of infraction proceedings before the court of the European Economic Communities, (c) items currently zero-rated which have been the subject of specific pledges from Ministers concerning their continued zero-rated status, (d) other items of zero-rating subject to current proposals from the Commission of the Commission of the European Communities and (e) other zero-rated items not in categories (a) to (d) above, showing for each item in each table (a) to (d) the rate or band of rates applied, or proposed to be applied, together with the approximate annual revenue, or range of revenue, which has accrued or is likely to accrue to Her Majesty's Government, at 1988 prices for each category, with totals for each table and grand total, and in respect of table (c) footnote references to the respective principal pledge made.

§ Mr. Lilley

[holding answer 18 March 1988]: The information requested is given in the tables. Table (a): There are no items which were zero-rated by the Government but which have subsequently had their zero-rated status changed by virtue of actions taken, or requests made by the Court or the Commission of the European Communities.

Table (b): Items subject to zero-rate infraction proceedings
(i)	(ii)	(iii)
Item	Proposed VAT rate band under approximation proposals Per cent.	Theoretical net revenue yield from (ii) (£ million at 1987–88 prices)
Animal feedstuffs, seeds, live animals yielding food for consumption (all supplies)	14–20	neg
Sewerage services supplied to industry	14–20	neg
Water supplied to industry	4–9	neg
News services (all supplies)	14–20	5
Fuel and power (supplies other than to final consumers)	4–9	5–15
Construction of buildings etc. (supplies other than to final consumers 'within a social policy')	14–20	1,200–1,500
Protective clothing and footwear (supplies to employers)	14–20	neg

Table (c): Zero rated items subject to Government pledges¹
(i)	(ii)	(iii)
Item	Proposed VAT rate band under approximation proposals Per cent.	Theoretical net revenue yield from (ii) (£ million at 1987–88 prices)
Food	4–9	1,100–2,400

196W

(i)	(ii)	(iii)
Item	Proposed VAT rate band under approximation proposals Per cent.	Theoretical net revenue yield from (ii) (£ million at 1987–88 prices)
Electricity, gas and fuel (supplies to domestic consumers)	4–9	450–1,000
Young children's clothing and footwear	14–20	325–475
¹ The pledge concerning these items has been made on numerous occasions. It was reiterated by the Prime Minister on 7 July 1987 {Official Report, Vol. 119, No. 13, column 192).

Table (d): Other zero-rated items subject to proposals from the Commission of the EEC
(i)	(ii)	(iii)
Item	Proposed VAT rate band under approximation proposals Per cent.	Theoretical net revenue yield from (ii) (£ million at 1987–88 prices)
Sewerage services other than supplies to industry	14–20	neg
Water other than supplies to industry	4–9	neg
Books, newspapers etc.	4–9	150–300
Taking books for the blind and handicapped and wireless sets for the blind	14–20	neg
Construction of buildings etc. supplied to final consumers "withing a social policy"	14–20	100–200
Protected buildings	14–20	neg
International services¹	—	—
Internal passenger transport	4–9	150–325
Other transport¹	—	—
Caravans and house boats	14–20	neg
Gold and bank notes1	—	—
Drugs and medicines	4–9	neg
Aids for the handicapped	14–20	neg
Exports to other EC member states	Rate applicable to goods in member state of export	—
Charities, etc.	14–20	neg
Protective clothing and footwear other than that supplied to employees	14–20	neg
¹ The position of these items under the proposals is not yet clear.

Table (e): Other items not in (a)-(d)
(i)	(ii)	(iii)
Item	Proposed VAT rate under approximation proposals	Estimated net revenue yield from (ii) (£ million at 1987–88 prices)
Exports to countries outside the EC	zero	nil