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Taxation: VAT

Volume 694: debated on Tuesday 17 July 2007

asked Her Majesty's Government:

Whether there are any current proposals from the European Commission to end United Kingdom VAT zero rating, including on books, newspapers, periodicals and children's clothes; and, if so, whether they will seek to maintain the United Kingdom's current exemptions. [HL4768]

The European Commission recently published a communication on VAT rates other than standard VAT rates, which sets out some options for reforming the current EC agreements on the application of reduced VAT rates, as a basis for future discussion among member states. However, this communication is not a formal legislative proposal.

Changes to EC VAT agreements are subject to the unanimous agreement of all member states. The Government have always made it clear that the UK will not agree to any proposals that would harm our social objectives or undermine the fairness of the UK VAT system. The Government have a manifesto commitment not to extend VAT to food, children's clothes, books, newspapers and public transport fares.