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Value Added Tax (School Bus Journeys)

Volume 982: debated on Thursday 17 April 1980

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asked the Chancellor of the Exchequer if he will list the criteria whereby it is determined whether a school bus journey is or is not eligible for value added tax refund.

The transport of passengers in any vehicle designed or adapted to carry not less than 12 passengers is zero rated for value added tax purposes and the question of refund of tax does not arise.Local authorities can normally recover the tax charged on all supplies of taxable services invoiced to them, either under the normal credit mechanism or under the special provisions of section 15 of the Finance Act 1972. No tax is chargeable on the onward supply to children of these transport services if they are supplied free of charge, or if the journey is undertaken for strictly educational purposes and the charge made by the local authority does not exceed the full cost.