15% VAT rate extended for New Year's Eve traders .
- 6 November 2009 08:5532516PRESS RELEASE from HMRC
Pubs, clubs, restaurants and other retail businesses remaining open past midnight on New Year's Eve will be allowed to continue charging VAT at 15% on their sales until they close or until 6am on 1 January 2010, whichever is the earlier, the Financial Secretary to the Treasury confirmed today.
Similar arrangements will apply to telecommunications companies in respect of calls and texts made up to 6am on 1 January.
Financial Secretary to the Treasury, the Rt Hon Stephen Timms MP, said:
"New Year's Eve celebrations are a vital source of income for many in the service sector. The Government recognises that it would be very difficult for them to make the necessary changes to account for VAT at 17.5% immediately after midnight. To make the transition as easy as possible retail and telecommunication businesses will be able to charge VAT at the old rate into the early hours of New Years Day.
"I announced in May 2009 that HMRC would be allowing a 'period of grace' to help businesses trading across midnight on 31 December in implementing the VAT rate change, and that they would work with business on the details. I am very pleased that HMRC is now able to confirm these arrangements and I hope that those businesses affected will find them helpful."email: dover7@msn.com - 6 November 2009 09:0032517This should help with those businesses trading through New Year. Its a difficult time for local businesses in the entertainment business as it were, so like they say..every little helps, and this measure will help the returns on that particular night anyway.
The press release also acts as a reminder that the dreary vat rate comes back to 17.5% from January 1st 2010.
If you have any large ticket items to buy in the near future now might be the time to do it.email: dover7@msn.com - 6 November 2009 09:1832523I guess still to be decided at the pre-budget report at the end of November - still convinced the rate will not be 17.5%
Been nice knowing you :) - 6 November 2009 11:2532533oh dear...you mean they could put it even higher??
Lets hope not as it would cripple business in mid recession. It may be on the cards eventually but 6 months before a general election maybe not.
Just to go political on this for the moment. The Tories pooh poohed the drop from 17.5% to 15% saying it was nothing but a drop in the ocean. They were scathing. But if they think that way, would they indeed push it the other way as Scotchie suggests there and make it 20%. The 2.5% drop was so little in their eyes, equally a 2.5% rise would also be so little in their eyes. The prospect isnt something to relish for the rest of us though.
So as I said earlier, this could indeed be a good time to buy that TV or that camera you were promising yourself.email: dover7@msn.com