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Value Added Tax

Volume 78: debated on Thursday 9 May 1985

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asked the Chancellor of the Exchequer what action he intends to take to implement his Budget proposals to relieve from value added tax certain temporarily imported goods and to change the arrangements for charging value added tax on certain reimported goods; and whether he will make a statement.

The Budget proposals relating to VAT on certain temporarily imported and reimported goods will be given effect by regulations made by the Commissioners of Customs and Excise under powers in the Value Added Tax Act 1983. These regulations have now been made and are being laid before the House today. They are subject to the negative procedure.The regulations provide relief from VAT for goods which are temporarily imported solely for repair, renovation, modification or treatment and which upon re-exportation are identifiable as the imported goods. The ownership in the goods may not be transferred to any person in the United Kingdom either at importation or during the time they remain in the United Kingdom and the goods must be re-exported within six months.The regulations also provide for VAT to be charged on goods which are reimported after repair, process or adaptation abroad as if that repair or process had been carried out in the United Kingdom—that is, generally on the cost of the work, plus any duty and freight. There must be an intention at the time of exportation to reimport the goods on completion of the process abroad, and the ownership in the goods must not be transferred to a person outside the United Kingdom either at exportation or during the time they remain abroad.The changes under these regulations will take effect from 1 June 1985.