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Value Added Tax

Volume 933: debated on Monday 13 June 1977

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asked the Chancellor of the Exchequer what would be the annual loss in revenue resulting from a VAT zero rating of all mechanical aids for disabled people and servicing of such aids.

Most mechanical aids specially designed for use by the disabled are already zero rated when supplied to the disabled and supported by a medical certificate. To extend this zero rating as suggested is likely to result in a loss of revenue of about £5 million and would also considerably complicate the working of the tax for traders and Customs alike.

asked the Chancellor of the Exchequer what rates of value added tax are levied on (a) GPO telephone equipment and (b) private telephone equipment.

All telephones and ancillary equipment of a kind supplied by the Post Office are chargeable at the standard rate of VAT, irrespective of the identity of the supplier or customer. The installation of telephone exchange equiment in the course of the construction or alteration of a building may in certain circumstances be eligible for zero rating.

asked the Chancellor of the Exchequer what is the treatment of bad debts for value added tax in each of the other member States of the EEC.

Practice varies considerably between member States, but in each of the other EEC countries relief from VAT on bad debts is available, although sometimes only on a very restricted basis. The relief may be granted either directly or indirectly, as in the case of the United Kingdom where some retailers using one or other of the special retail schemes do not in fact pay VAT on their bad debts.