VILLAGE HALLS AND VAT

HL Deb 27 July 1989 vol 510 cc1673-4WA

Lord O'Hagan

asked Her Majesty's Government:

Whether they are satisfied that they have consulted fully with all the representative bodies to discuss the impact of the imposition of Value Added Tax on village halls.

The Earl of Caithness

Village halls representatives were consulted both before and during the passage of the Finance Bill, and have been kept fully informed of its likely impact on their activities.

Lord O'Hagan

asked Her Majesty's Government:

What steps they have taken to consult with the Commission of the European Communities to ensure that village halls remain exempt from Value Added Tax.

The Earl of Caithness

The Economic Secretary to the Treasury wrote to the EC Commissioner responsible for tax matters and obtained her clarification of the VAT position of supplies of new construction and fuel and power to village halls.

Lord O'Hagan

asked Her Majesty's Government:

What advice they would now offer to village hall Committees about the imposition of Value Added Tax.

The Earl of Caithness

The only item of village halls' expenditure affected by the current Finance Bill legislation giving effect to the European Court of Justice's judgement on VAT zero rates is fuel and power. The Finance Bill (in addition to retaining the zero rate for domestic consumers) will allow fuel and power to remain zero-rated when supplied below certain setde minimis levels or for a charity's non-business purposes. Committees of village halls whose consumption is above the de minimis levels may wish to consider whether, rather than making set charges, they should ask for donations for some or all of their lettings, in order to take advantage of the latter relief.

Lord O'Hagan

asked Her Majesty's Government:

What steps they have taken to mitigate the impact of the decision of the European Court of Justice to impose Value Added Tax on village halls.

The Earl of Caithness

The Finance Bill was amended at Report stage in the House of Commons to reinstate the zero rate for the new construction of village halls and similar charitable buildings.