UK government proposes VAT cut to ease pain of rising prices

UK government proposes VAT cut to ease pain of rising prices

 (Reuters) - Britain has proposed a cut in value-added tax, or VAT, to help households with the cost of living, The Times reported. Prime Minister Boris Johnson's chief of staff Steve Barclay suggested reducing the 20% headline rate of the tax, the report said, adding a temporary cut would reduce the tax bill for millions. According to the Times, in his letter to party lawmakers on the day of a confidence vote last month, Johnson said energy would be devoted to "reducing the biggest single household outgoing of all — the tax bill. It must come down, and it will, because that is the best…
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EU paves way for cheaper internet, bicycles, solar panels through lower VAT

EU paves way for cheaper internet, bicycles, solar panels through lower VAT

European Union finance ministers agreed on Tuesday to change EU rules so that they can cut the Value Added Tax (VAT) on goods and services linked to fighting climate change, health protection and making the EU more ready for the digital age. At the same time they agreed to phase out by 2030 some of the existing lower VAT rates on fossil fuels or other goods that add to greenhouse gas emissions, to help the 27-nation bloc reach its target of not emitting any CO2, in net terms, by 2050. The EU's standard minimum VAT rate on all goods and services is…
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Sunak considers cutting VAT on household energy bills

Sunak considers cutting VAT on household energy bills

(Reuters) - British finance minister Rishi Sunak is considering a cut to the 5% rate of value-added tax on household energy bills, the Financial Times reported on Sunday. Government officials briefed on the Budget preparations said Sunak had looked at reducing the 5% VAT, but no decisions had been taken yet, the newspaper added. Reuters / FT (Reporting by Sabahatjahan Contractor in Bengaluru; Editing by Emelia Sithole-Matarise) Photo British Chancellor of the Exchequer Rishi Sunak departs 10 Downing Street following a cabinet meeting in London, Britain. EPA-EFE/ANDY RAIN
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EU countries lost €140 billion in VAT revenues in 2018, with a potential increase in 2020 due to coronavirus

EU countries lost €140 billion in VAT revenues in 2018, with a potential increase in 2020 due to coronavirus

EU countries lost an estimated €140 billion in Value-Added Tax (VAT) revenues in 2018, according to a new report released by the European Commission today. Though still extremely high, the overall ‘VAT Gap' – or the difference between expected revenues in EU Member States and the revenues actually collected – has improved marginally in recent years. However, figures for 2020 forecast a reversal of this trend, with a potential loss of €164 billion in 2020 due to the effects of the coronavirus pandemic on the economy. In nominal terms, the overall EU VAT Gap slightly decreased by almost €1 billion…
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European Commission approves waiving of customs duties and VAT on medical devices and equipment

European Commission approves waiving of customs duties and VAT on medical devices and equipment

The European Commission approved requests from Member States and the UK to temporarily waive customs duties and VAT on the import of medical devices, and protective equipment, from third countries in order to help in the fight against coronavirus. This will make it easier financially to get the medical equipment that doctors, nurses and patients desperately need. The Commission has swiftly approved requests received from all Member States. This measure includes masks and protective equipment, as well as testing kits, ventilators and other medical equipment. It will apply for a period of 6 months, with a possibility for further extension.…
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British businesses told to complete Brexit preparations

British businesses told to complete Brexit preparations

The British HM Revenue and Customs has written to businesses that trade with the EU, urging them to step up their preparations for a potential no-deal Brexit. HMRC’s deputy chief executive, Jim Harra, sent letters to two groups of VAT-registered businesses in the UK – those that trade only with EU states, and those that trade both with the EU and other international markets – setting out the steps they must take to be ready for Brexit. The letters, branded with the government’s Get Ready for Brexit campaign slogan, each included a checklist of actions to take, including registering for…
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EU countries lost €137 billion in VAT revenues in 2017, Malta registers large decrease in VAT losses

EU countries lost €137 billion in VAT revenues in 2017, Malta registers large decrease in VAT losses

EU countries lost €137 billion in Value-Added Tax (VAT) revenues in 2017 according to a study released by the European Commission today. The so-called 'VAT Gap' - or the overall difference between the expected VAT revenue and the amount actually collected - has reduced somewhat compared to previous years but remains very high. This substantial VAT Gap again highlights the need for comprehensive reform of the EU VAT rules, as proposed in 2017 by the Commission, and increased cooperation between Member States to clamp down on VAT fraud and to make the rules work for legitimate businesses and traders. The…
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UK VAT set to increase after Brexit

UK VAT set to increase after Brexit

MPs have warned of the dangers of the Brexit transition period after it emerged that hundreds of thousands of small businesses could be forced to pay VAT for the first time after Britain leaves the European Union. Brussels is preparing to reduce the threshold at which businesses start paying VAT from a turnover of £85,000 to £76,700 in a bid to "harmonise" tax systems. The Telegraph reports "MPs on the EU scrutiny committee warned Britain will have to accept the move if it comes into force after Brexit in March 2019 because it will lose its right to veto the plans. Under the terms of the Prime Minister's deal,…
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European Commission welcomes progress on improvements on VAT in EU

European Commission welcomes progress on improvements on VAT in EU

The European Commission has welcomed the progress made today by Member States on much-needed improvements to how Value Added Tax (VAT) works in the EU. Tuesday's meeting of EU finance ministers in Luxembourg saw agreements on a number of files in this field, all of which should help in the day-to-day running of an EU VAT system which is in urgent need of further far-reaching reform. "New figures released by the Commission just weeks ago show that Member States are still losing €150 billion in VAT each year. Today's agreements are another step towards addressing that problem and changing VAT…
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Greece, Romania and Italy register highest VAT evasion

Greece, Romania and Italy register highest VAT evasion

Romania (35.88%), Greece (29.2%) and Italy (25.9%) have registered the highest VAT tax evasion in the past years. As a whole, the EU recorded revenue losses on VAT of € 147.1 billion. The figure is down by € 10.5 billion compared to the previous year with a reduction of the 0.9% gap, falling to 12.3% from 13.2%. The EU countries where the VAT evasion is the lowest are Luxembourg (0.85%), Sweden (1.08%) and Croatia (1.15%). The VAT gap has decreased in 22 Member States, with excellent results achieved by Bulgaria, Latvia, Cyprus and the Netherlands, each of which registered a…
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