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Energy Bills (Vat)

Volume 176: debated on Friday 13 July 1990

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To ask the Chancellor of the Exchequer what is the expected yield from the imposition of value added tax on (a) gas and (b) electricity bills where supplies are made to domestic premises for business purposes.

The revenue yield will be negligible. This is because many businesses operating from domestic premises will continue to receive zero-rated supplies under arrangements designed to simplify the administration of taxing fuel and power. VAT-registered businesses which are charged tax will be able to reclaim it under the input tax credit mechanism.