§ Mr. David MarshallTo ask the Secretary of State for Transport if he will give for 1989–90,1990–91, and 1991–92, the provision for value added tax liability on new construction within the budgets given for local authority capital spending on roads and transport in table 8–1 of "the Government's Expenditure Plans 1989–90 to 1991–92" chapter 8.
§ Mr. Peter BottomleyLocal authorities have always been able to reclaim VAT paid on any expenditure not for a business activity. This rule now automatically extends to their road construction programme. VAT paid by their business activities, such as their airport companies, is covered by the normal reclaim procedure applicable to the private sector. Extra provision is not needed.