HC Deb 20 February 1992 vol 204 cc254-5W
Mr. Dykes

To ask the Chancellor of the Exchequer (1) if he will give details of the quantity and content of representations he has received concerning the change to the postponed accounting system for VAT on goods and services commencing on 1 January 1993;

(2) how many individual businesses he expects to be included in the new postponed accounting system for VAT in each of the years 1993, 1994 and 1995;

(3) what assessment he has made of the effect on the cash flow of businesses of the postponed accounting system for VAT at the end of 1992.

Mrs. Gillian Shephard

[holding answer 14 February 1992]: No representations directly relating to the postponed accounting system have been received. Businesses have been informed of the change which has been generally welcomed because of the resulting cash flow benefits. Some representations have been received on the proposals that the larger businesses will be required to account for VAT monthly to offset the cash flow loss to the exchequer which is a consequence of the postponed accounting system.

Some 90,000 businesses will be included in the postponed accounting system and, because they will no longer need to pre-finance the payment of VAT on imports of goods and associated services from other EC countries, these businesses will make a cash flow saving equivalent to deferring payment for six weeks.

Dr. Marek

To ask the Chancellor of the Exchequer if the items listed as zero-rated for VAT in table 4B.1 of annex B to chapter 4 of the "Financial Statement and Budget Report 1991–92" are safeguarded until at least December 1996.

Mrs. Gillian Shephard

[holding answer 19 February 1992]: Yes. In the context of European Community negotiations last year on VAT rates, our right to continue to apply all our existing zero rates was confirmed. The

Taxpaying single people and married couples1 with investment income in 1991–92
Single people under 65 One taxpayer married couples under 65 Two taxpayer married couples under 65
Total income lower limit £ per year Number (000's) Average Investment Income £ per year Number (000's) Average Investment Income £ per year Number (000's) Average Investment Income £ per year
3,000 1,700 560 90 640 — —
7,000 2,100 640 440 780 — —
10,000 2,500 870 1,500 890 230 1,300
15,000 1,200 1,100 1,300 970 640 1,100
20,000 750 1,600 1,100 1,200 1,400 1,400
30,000 160 3,600 280 1,900 660 2,200
40,000 120 13,000 260 7,700 660 9,700

Single people 65 and over One taxpayer married couples 65 and over Two taxpayer married couples 65 and over
Total income lower limit £ per year Number (000's) Average Investment Income £ per year Number (000's) Average Investment Income £ per year Number (000's) Average Investment Income £ per year
3,000 430 1,400 10 220 — —
7,000 290 2,500 160 1,300 — —
10,000 210 4,500 330 2,500 40 4,100
15,000 70 7,900 120 3,600 60 6,300
20,000 60 14,000 70 4,500 100 8,100
30,000 20 19,000 20 11,000 40 16,000
40,000 20 42,000 10 21,000 50 24,000
1 Counting married couples as one and combining their incomes.