EU too restrictive taxes?

[El Cid]

I also think more basics should be zero rated for VAT. The EU currently prevents this, but even if we stay in it may be possible to persuade them. It would be very useful to reduce the VAT burden on the working poor.

 

Do you trust our Government to run our country. If the answer is yes, then perhaps they should fight for more freedom, whether we are in or out of the EU.

 

George Osborne was allowed to increase VAT to 22.5% in the last budget, so why do we hear these excuses about cannot do this, because of the EU?

I believe that the EU want all our tax rates to merge to the same rate; but if they dont know what rate it should merge to, its nonsense.

[RonJeremy]

Do you trust our Government to run our country. If the answer is yes, then perhaps they should fight for more freedom, whether we are in or out of the EU.

 

George Osborne was allowed to increase VAT to 22.5% in the last budget, so why do we hear these excuses about cannot do this, because of the EU?

I believe that the EU want all our tax rates to merge to the same rate; but if they dont know what rate it should merge to, its nonsense.

 

it does seem that way. The post not George Osborne.

[El Cid]

it does seem that way. The post not George Osborne.

 

Perhaps someone could start a pro-EU thread?

[L00b]

Do you trust our Government to run our country. If the answer is yes, then perhaps they should fight for more freedom, whether we are in or out of the EU.

 

George Osborne was allowed to increase VAT to 22.5% in the last budget, so why do we hear these excuses about cannot do this, because of the EU?

I believe that the EU want all our tax rates to merge to the same rate; but if they dont know what rate it should merge to, its nonsense.

Could we have a link or at least some context for your quote? The rest of your OP might begin to make sense then.

 

FWIW the EU does not prevent EU Member States from zero-rating VAT on certain goods or services, particularly basics (food and children's clothes, typically).

 

What the EU prevents is zero (or low) VAT rating by an EU Member State to such an extent (on so many different goods or services beyond basics) as amounting to anti-competitive tax dumping at the expense of other EU Member States.

Edited September 4, 2015 by L00b

[El Cid]

The fragmentation of the common EU VAT system into 27 national VAT systems is the main obstacle to efficient intra-EU trade and thus prevents citizens from reaping the benefits of a genuine single market.

 

European Union VAT directive, the aim of the EU VAT directive on the common system of value added tax, is to harmonize VAT within the EU VAT area, and specifies that VAT rates must be within a certain range.

 

Households must pay higher VAT on insulation and solar panels, EU rules.

 

http://www.telegraph.co.uk/news/earth/energy/11652827/Households-must-pay-higher-VAT-on-insulation-and-solar-panels-EU-rules.html

[RonJeremy]

The fragmentation of the common EU VAT system into 27 national VAT systems is the main obstacle to efficient intra-EU trade and thus prevents citizens from reaping the benefits of a genuine single market.

 

European Union VAT directive, the aim of the EU VAT directive on the common system of value added tax, is to harmonize VAT within the EU VAT area, and specifies that VAT rates must be within a certain range.

 

Households must pay higher VAT on insulation and solar panels, EU rules.

 

http://www.telegraph.co.uk/news/earth/energy/11652827/Households-must-pay-higher-VAT-on-insulation-and-solar-panels-EU-rules.html

This makes a little more sense than your original post. Thank you.

[L00b]

The fragmentation of the common EU VAT system into 27 national VAT systems is the main obstacle to efficient intra-EU trade and thus prevents citizens from reaping the benefits of a genuine single market.

Utter poppycock.

 

The 'fragmenting common EU VAT system' was brought about to harmonize the pre-existing national VAT systems and ensure that VAT

 

(i) would not be charged twice in respect of goods sold within the EU and

(ii) would not be used by individual countries anti-competitively.

 

(i) is part and parcel of implementing free movement of goods, (ii) is how and why the EU VAT directive sets VAT thresholds (the important ones being the lower thresholds which inhibit anti-competitive practices, good old market dynamics take care of the upper end).

 

Consumers reap the full benefits of a harmonized VAT system EU-wide, able as they are to buy all their tat from Amazon and eBay in the UK and yet pay VAT at Luxembourg's 15% instead of the UK's 20%.

 

Regarding the insulation/renewables, under EU law member states can only apply reduced VAT rates in the housing sector if it is part of a social policy. This is old law.

 

The UK Treasury held that the Green Deal and ECO schemes were both social policies and applied the lower VAT rate from the get-go, without checking with the Commission.

 

The matter was eventually taken to the ECJ and the ECJ has eventually decided they weren't social policies, so the UK Treasury was wrong and the higher VAT rate applies.

 

The UK Treasury will no doubt appeal.

 

I'm not sure what increasing VAT from 5% to 20% on solar panel fittings has got to do with your OP about zero-rated basics?

 

Particularly when many utilities and councils offer free insulating hand-over-fist for which people don't pay a penny (nor of VAT), and very many (if not most) people with solar panels get them from the roof-leasing FiT-hijacking corpos and again don't pay a penny (nor of VAT).

 

It's the roof-leasing, free-solar-PV-supplying corpos that are crying, because the VAT hike could end up extending their return on investment period a little (not that much at all, since they can claim back VAT on supplies anyway, whether at 5% or 20%).

 

Now, remind me when was the last time a UK retailer dropped its prices to its customers, when the VAT rate applicable to its goods was reduced? The economic expression you're looking for is 'discrete pricing'

Edited September 4, 2015 by L00b

[Annie Bynnol]

Do you trust our Government to run our country. If the answer is yes, then perhaps they should fight for more freedom, whether we are in or out of the EU.

 

George Osborne was allowed to increase VAT to 22.5% in the last budget, so why do we hear these excuses about cannot do this, because of the EU?

I believe that the EU want all our tax rates to merge to the same rate; but if they dont know what rate it should merge to, its nonsense.

 

Which parts of this post are accurate?

Another mis informed anti EU bash?

Standard VAT rate is 20%.

[unbeliever]

Do you trust our Government to run our country. If the answer is yes, then perhaps they should fight for more freedom, whether we are in or out of the EU.

 

George Osborne was allowed to increase VAT to 22.5% in the last budget, so why do we hear these excuses about cannot do this, because of the EU?

I believe that the EU want all our tax rates to merge to the same rate; but if they dont know what rate it should merge to, its nonsense.

 

I think the quote is me on another thread.

I was referring to the fact that it's hard to move goods from non-zero VAT rated to zero-rated within EU rules. I was suggesting that whatever the result of the EU referendum, it would be progressive to zero rate more basics across Europe if we're in or just in the UK if we're out.

I'm wasn't in an EU bashing mood at the time.

I just thought it would be a good thing for the poor if adult clothes, heating, maybe household items and various other basics were zero-rated.

Edited September 4, 2015 by unbeliever