Skip to main content

Taxation: Health Professions

Volume 502: debated on Monday 14 December 2009

To ask the Chancellor of the Exchequer pursuant to the answer of 1 December 2009, Official Report, column 655W, on health professions: pay, for what reasons (a) pharmacy contractors are and (b) appliance contractors are not zero-rated for value added tax. (306061)

[holding answer 10 December 2009]: VAT is a broad-based tax on consumer expenditure and reliefs from it have always been strictly limited. When the UK joined the European Community (EC) in 1973, we signed up to the agreements which govern the application of VAT throughout the EC. Under these and successive agreements the UK is allowed to keep zero rates of VAT on certain items—many of which had been exempt from the purchase tax which preceded VAT—including drugs and medicines supplied by a pharmacist against a prescription. Most other goods and services became taxable at the standard rate and have remained taxable ever since. This includes most goods supplied by appliance contractors.