Skip to main content

Value Added Tax

Volume 974: debated on Monday 26 November 1979

The text on this page has been created from Hansard archive content, it may contain typographical errors.

asked the Chancellor of the Exchequer (1) what has been the total sum of value added tax collected in each of the last five years in transfer fees for professional footballers on transactions between British clubs;(2) what has been the total amount involved for each of the last five years on transfer fees for professional footballers between British and foreign clubs where the value added tax has been zero rated;(3) if he will introduce legislation to seek to amend the relevant Finance Act whereby there is no value added tax receivable by Her Majesty's Government on football transfer fees paid to British clubs by foreign clubs.

I am afraid that there is no information available on the amount of VAT charged on the transfer of professional footballers to British clubs, or on the amount that would have been chargeable had not transfers to foreign clubs qualified for zero rating, because persons registered for VAT are not required to make returns of the tax charged on particular goods or services. In general however, transfers to British clubs produce no net VAT revenue for the Exchequer because the registered clubs are normally able to offset the tax incurred on players transferred to them against the tax due on their admission charges and other taxable transactions. The zero rating of transfers to foreign clubs arises because, for the purposes of VAT, the supply of a player on transfer is regarded as a supply of staff and supplies of staff to overseas businesses are eligible for relief as an export of services—zero-rate group 9 international services. I have no plans to withdraw this relief. The Government's policy is that VAT must apply to sports bodies registered for VAT in exactly the same way as it does to registered persons generally.