Skip to main content


Volume 456: debated on Wednesday 31 January 2007

To ask the Chancellor of the Exchequer pursuant to the answer of 19 December 2006, Official Report, column 1747W, on VAT, how many companies have had applications for VAT refunds rejected as a result of the change in law on 3 December 2004 regarding VAT on the supply of services to non-EU customers; and if he will make a statement. (110853)

[holding answer 23 January 2007]: The information requested is not readily available and could be provided only at disproportionate cost.

To ask the Chancellor of the Exchequer whether he plans to offer compensation to traders of the mobile phone and computer-chip industries who suffer financial hardship due to their VAT repayments claims being under extended review. (111890)

Under Section 79 of the VAT Act 1994 HM Revenue and Customs are required subject to certain conditions, to compensate any business for failing to repay a legitimate repayment claim within 30 days of receipt of the VAT return.

However, when calculating the time taken to authorise the claim, sections 79(3) and (4) of the VAT Act provides for HM Revenue and Customs to deduct the time taken to make reasonable enquiries to verify the legitimacy and accuracy of the claim and to correct any errors or omissions on the return.

As the hon. Member has specifically referred to the mobile phone and computer-chip industries, I would also refer him to my response of 24 January 2007, Official Report, columns 1859-60W.