§ Mr. LidingtonTo ask the Chancellor of the Exchequer what assessment he has made of the implication of judgment of the European Court of Justice against the Kingdom of the Netherlands (Case C-338/98) for(a) the policy of HM Customs and Excise with regard to input-VAT deductions for taxable employers on the expenses of their employees and (b) annual irrecoverable VAT revenue for HM Treasury; and if he will make a statement. [20387]
§ Mr. Boateng[holding answer 5 December 2001]: Customs and Excise are exploring the implications of this decision with the European Commission, and will consider whether any changes are required to ensure the UK's VAT rules are compatible. The Government will consult UK businesses closely about these implications, but are not prepared to impose any unnecessary costs or burdens on them. In the meantime, UK businesses can continue to rely on current UK law, policy and practice.
§ Mr. LawsTo ask the Chancellor of the Exchequer what the ratio of value added tax receipts to consumptions was, setting out the variation between the forecast VAT/ consumption ratio and its actual outturn, in each of the last four years; and if he will make a statement. [20219]
§ Mr. Boateng[holding answer 6 December 2001]: As the hon. Member will be aware, since pre-Budget 1997 the VAT receipts forecast is governed by a National Audit Office assumption that the VAT/Consumers' Expenditure ratio declines by 0.05 per cent. per year.
689W
VAT/consumers' expenditure ratio implied by forecasts for respective Budgets Ratio outturns 1997 –98 9.69 9.51 1998 –99 9.77 9.24 1999 –2000 9.46 9.44 2000 –01 9.59 9.36