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VAT: Disabled

Volume 488: debated on Wednesday 25 February 2009

To ask the Chancellor of the Exchequer what plans he has to review the rules relating to value added tax relief for people with disabilities; and if he will make a statement. (257258)

VAT zero-rating currently applies to a wide range of goods and services supplied to disabled people for their personal use. Under the VAT agreements with our European partners signed by successive governments, we can retain our existing VAT zero rates, but we may not extend them or introduce new ones. It is therefore not possible to remove VAT from additional goods and services purchased by disabled people.

The same VAT agreements allow EU member states to introduce reduced rates of VAT of not less than 5 per cent. on a prescribed list of goods and services. All taxes are kept under review, but given the wide range of the UK's zero rates we see little scope within the reduced rate list for the introduction of further VAT reliefs that would benefit disabled people.

To ask the Chancellor of the Exchequer what assessment his Department has made of (a) the total value of value added tax (VAT) relief on goods and services for people with disabilities, (b) the number of sold goods for disabled people which were VAT zero-rated and (c) the number of disabled people who have received goods and services that have been VAT zero-rated in each year since 1997. (257259)

Estimates of the value of the VAT zero rate on vehicles and other supplies to people with disabilities are published in Table 7 of the Tax Ready Reckoner and Tax Reliefs, available on the HM Treasury website at:

www.hm-treasury.gov.uk/d/pbr08_taxreadyreckoner_287.pdf

These estimates are based on expenditure data only. HM Revenue and Customs does not collect information on the number of such goods sold, or on the number of disabled people receiving them.