SIGN UP

Vat And Brexit?

Avatar Image
EDDIE51 | 20:38 Thu 20th Apr 2017 | Business & Finance
19 Answers
VAT was the EU's alternative to purchase tax, so once we are out of the EU will we revert to purchase tax?

Answers

1 to 19 of 19rss feed

Best Answer

No best answer has yet been selected by EDDIE51. Once a best answer has been selected, it will be shown here.

For more on marking an answer as the "Best Answer", please visit our FAQ.
who knows? the details are not all worked out yet
lots of countries have VAT; but they can call it anything they like (and tax anything they like). For all I know they'll go back to £sd and bring back leagues and furlongs.
And Pounds and Ounces ( I hope ).
Question Author
A bit of Googling tells me VAT is the government's second largest source of tax income, so I can't see them wanting to change it.
and the scold's bridle.
yeah or no
according to the rabid brexiters - there will be no tax at all
and it will be paradise .... from Day 1 of course
( we know this because St Nige said it would be like that )

jesus why do we wish to revert to purchase tax unless it gives a greater tax take ? ( which it wouldnt as you pay VAT on just about everything)
// who knows? the details are not all worked out yet//

yeah Brexit is a big exciting unknown
( not quite what was promised when the gullible public voted for it - then it was "we will close the borders" - " chuck out the foreigners " and " spend 350m a week on the NHS or even more !" )

instead we got wall to wall 3T
Question Author
I'm old enough to remember there was a LOT of opposition to VAT when we were forced to introduce it. But it has become such a huge source of government income I can't see how it can be changed.
how did purchase tax work?
VAT is a continental invention. French tax authority apparatchik Maurice Lauré fathered the tax in 1954, although a tax that touched on every stage of the production process was first theorised in Germany a century earlier. VAT took its bow in the UK in November 1974, as part of the price the UK paid for joining the Common Market.

The UK's previous consumption tax, the Purchase Tax, was levied at different rates depending on an item's perceived "luxury". Initially, UK VAT was set at a standard rate of 10%. Almost immediately, the standard rate was shaved to 8% and joined by a higher rate of 12.5% for petrol and certain luxury goods. By the end of the decade both rates had been "harmonised" at 15%, which is where VAT stayed until the 1991-92 tax year, when John Major's government nudged it upwards to 17.5%. There it has stayed for the best part of two decades.

https://www.theguardian.com/money/2010/dec/31/vat-brief-history-tax
sounds complex. A simple harmonised rate makes more sense.
Maybe, maybe not. Those are the decisions that he government are paid to make. But if one has a working tax in place one needs a good reason to replace it.
A rise in income tax and removal of a second tax on our money when we spend it, would be both less complex and fairer.
Adding a fifth for no apparent reason to many, many things that I buy has always seemed fair and equitable

Yes I'm being sarky.
I liked Ken Dodd's jokes against himself:

1. 1799. William Pitt introduced income tax. 2d in the pound. Trouble was I thought that was still the going rate.

2. I can't owe the Inland Revenue anything because I live at the seaside.
Different rates of VAT apply in different EU member states, ranging from 17% in Luxembourg to 27% in Hungary.

EU VAT (known as "output VAT", that is, VAT on its output supplies) is charged by a business and paid by its customers. VAT that is paid by a business to other businesses on the supplies that it receives is known as "input VAT" (that is, VAT on its input supplies). A business is generally able to recover input VAT to the extent that the input VAT is attributable to (that is, used to make) its taxable outputs. Input VAT is recovered by offsetting it against the output VAT for which the business is required to account to the government, or, if there is an excess, by claiming a repayment from the government. The final consumer does not receive a credit for the VAT paid. The net effect of this is that each supplier in the chain remits tax on the value added, and ultimately the tax is paid by the end consumer.
To paraphrase a quotation- A tax by any other name would hurt as much.
// VAT is a continental invention. French tax authority apparatchik Maurice Lauré fathered the tax in 1954,//

yeah we should be calling it TVA ( tay vay ar)
and sort of goes on everything

and "Fransh tax authority apparatchik"
Laure would be an enarque - graduate of the ecole nationale d'administration and they are the ones who go onto be hauts fonctionnaires or mandarins to us Anglos in Euroland

the thing about VAT is that the end seller collects it for the govt
and I dont recollect purchase tax being like that ( paid by the seller )

I did actually do accounts in 1969 ( oo-er Mrs !) and purchase tax didnt feature at all - now VAT is a big thing....

yeah lets revert to Purchase tax
and pounds shillings and pence - decimalisation is another damned French import ....( no no please this is AB dont put me out of my decimalisation misery by pointing out the dates refute the contention)
//To paraphrase a quotation- A tax by any other name would hurt as much.// Danny ya narty narty bye
that is too topical - kindly leave AB !

actually there are some surprisingly cerebral conts about VAT and life before VAT and 1973 - I apologise to Mynheer meesters and tonyav....apolz and dubbl sozza
I have been reading 2 much of " why dont vey get those muslim jobbies and machine gun dem all like de French do?" -and It has taken the critical edge off me.


much better explained than I could do.....

reverting out of VAT has a huge on-cost for the gubmint as the end seller does so much of the collecting at present and bears the cost

1 to 19 of 19rss feed

Do you know the answer?

Vat And Brexit?

Answer Question >>

Related Questions