§ Mr. David PorterTo ask the Chancellor of the Exchequer if he will bring forward proposals to collect value added tax from businesses at the current rate only on the turnover above the registration threshold; and if he will make a statement.
§ Sir John CopeValue added tax is a transaction-based tax; it is collected by registered businesses from their customers and remitted to Customs. Unlike direct taxes, it is not a tax on the business. The relief suggested is, therefore, not appropriate.
§ Mr. Andrew SmithTo ask the Chancellor of the Exchequer what are the terms of reference of the planned review of the exemption from value added tax of educational materials; and when he expects the review to be completed.
§ Sir John CopeCustoms and Excise are undertaking an internal review of the VAT exemptions available for educational services provided by fee paying schools, universities and other businesses to see whether, consistent with EC legislation, there is scope for simplification and rationalisation. It is too early yet to say how soon the review will be completed. There is no general exemption for the supply of educational materials and this is not part of the review.