HC Deb 26 October 1992 vol 212 cc461-2W
Mr. Kirkwood

To ask the Chancellor of the Exchequer what assistance will be provided under the distance selling scheme and the flat rate scheme to vendors of horses selling for less than £15,000.

Sir John Cope

Bloodstock industry representatives have indicated that both schemes could be of some assistance when selling horses with a value of £15,000 or less. It is for individual vendors to assess the advantages of the new arrangements which will be able from 1 January 1993.

Mr. Kirkwood

To ask the Chancellor of the Exchequer if he will introduce regulations to enable race horse owners to be registered for VAT.

Sir John Cope

Eligibility for VAT registration is governed by both European Community law and United Kingdom law. Under the present rules of racing, race horse owners in the United Kingdom do not qualify for VAT registration because it is not a business activity making taxable supplies. This opinion has been upheld in individual cases by the independent VAT tribunals.

Mr. Kirkwood

To ask the Chancellor of the Exchequer what estimate has been made of the financial effect on the domestic bloodstock industry of the new VAT required to be imposed as part of the EC single market changes on 1 January 1993.

Sir John Cope

It is not possible to make any reliable estimate of the financial effects future changes to the VAT regime will have on the United Kingdom bloodstock industry. VAT is only one of several factors which determine its finances, but, as long as the industry ensures that its members fully understand the new rules for the single market, they should not be significantly disadvantaged by them.

Mr. Kirkwood

To ask the Chancellor of the Exchequer if he will make a statement outlining the ways in which the changes to be introduced on 1 January 1993 to the VAT regime affecting the bloodstock industry achieves parity of treatment between British breeders and their overseas counterparts.

Sir John Cope

The present VAT arrangements will in large part remain after 1992, although in some cases in a different form. British breeders should therefore maintain broadly the same position in relation to their overseas counterparts as now. The introduction of an agricultural flat-rate scheme in the United Kingdom in 1993 will be an extra scheme, not currently available, which will allow those breeders who opt to become flat-rate farmers to sell horses and nominations free of VAT, in exactly the same way as their European counterparts.

Mr. Kirkwood

To ask the Chancellor of the Exchequer if he will reconsider introducing regulations to enable a low VAT rate to be applied to the United Kingdom bloodstock industry; and if he will make a statement.

Sir John Cope

The Government's policy is to maintain a simple VAT structure with a single positive rate. Any concession for racehorses would inevitably bring pressure for a similar concession on a wide range of goods and services, where it was felt that the case was just as strong as that for bloodstock.