HMRC and HMT have announced a review, working in partnership with
business, on how to simplify VAT rules and administration in the UK and the
EU. They are seeking views (including through an on-line questionnaire)
by the end of November from businesses and other stakeholders.
Five areas prioritised for simplification include the ‘option to tax’;
partial exemption (including the capital goods scheme); frequency of return
submission; VAT retail schemes; and complexities requiring simplification at
an EU level.
An update on progress will be reported at Budget 2008.
Any simplification to the VAT system must be welcomed. Businesses should
feel encouraged to submit their views on the priorities. The
on-line questionnaire should facilitate this.