Archive for Downsizer For an ethical approach to consumption
 


       Downsizer Forum Index -> Energy Efficiency and Construction/Major Projects
Treacodactyl

VAT rise on energy saving products

EU rules the UKs reduced VAT rate on things like solar panels, insulation etc is illegal and it should be 20%.

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

Anyone know if this is true? For some reason it's in the right of centre press but not the left (The Guardian, BBC etc). Is it a scare story or are some ignoring it?
Mistress Rose

Whichever the answer is, the press are going to have to backpedal on the anti-EU things sooner or later if the PM decided he has done enough 'renegotiation' to make it worth while for the UK to stay in Europe. Of course Scotland, Wales and Northern Ireland may decide to anyway, which would just leave England to have to go along with the referendum because we don't have out own parliament. Of course if we did, we might have the funny situation where the PM pulled out, but all the countries in the UK stayed in. Amusing.
Falstaff

"........... Roger Helmer, Ukip's energy spokesman, said the ECJ ruling was "simply ridiculous beyond belief".

"While the EU claims it wants to reduce energy consumption, this judgement shows what the EU ‘really really wants’ is to increase its take from the VAT system from which it takes a portion of every transaction," he said. .........."


I didn't know the EU gets a lump of our VAT payments ! Shocked
Nick

Yep, about a third of one percent. And we then get two thirds of it back via the rebate.
Falstaff

Where are you getting those numbers from ?
Nick

http://ec.europa.eu/budget/revexp/revenue_and_expenditure_files/data/revenue_and_expenditure_en.xls

Wink
Mistress Rose

As far as I know, the EU can say something should have VAT on it, but it is the individual countries that fix the rates. If the UK government want to fix the VAT rate at 0 or 1%, I think they can. Do the EU get a direct cut anyway? I thought each government paid an agreed amount, which has to come through taxation of all sorts, then it gives the money out in grants, rebates and other forms.
Nick

No. The EU mandates vat at a minimum level of 15%, but allows a few goods or services to be at a lower rate. A zero rate is allowed by derogation for relatively few items in the UK. If we ever raise this, it cannot then be reduced back down.

A country's contribution is made of several parts, one of which is a direct cut of vat receipts. For us, it's currently 0.33%.

Vat based revenue makes up about 20% of what we pay into the EU.
Ty Gwyn

Considering most businesses claim back their VAT,then the 20% is made up by the non business public.
Behemoth

That's how vat works, the end consumer pays, not the supply chain.
vegplot

Considering most businesses claim back their VAT,then the 20% is made up by the non business public.


It's the end consumer that pays. Businesses collect the tax.
Ty Gwyn

Considering most businesses claim back their VAT,then the 20% is made up by the non business public.


It's the end consumer that pays. Businesses collect the tax.


Or claim back as in Farming,a zero rated business
Nick

Considering most businesses claim back their VAT,then the 20% is made up by the non business public.

Fag packet calculation suggests it's about £23 per person, annually, on average, and massively weighted in favour of the poorest.
Mistress Rose

I didn't realise that Nick. Thanks.

What sort of things can you claim back for as a farmer Ty Gwyn? In our case we are not VAT registered so our business has to absorb the VAT, although it is included in the cost to the customer, just not as a separate item.
Ty Gwyn

Vat on all your purchases into the business basically,ie.machinery and repairs,contractors labour,,fencing materials,red diesel,and fuel associated with the business,building materials,working cloths.
Everything that comes into the business.
Nick

Same as any registered business then. Mistress Rose

Yes. To date we haven't bothered being VAT registered because it would mean we would either have to put our prices up, in some cases significantly, or absorb more of the cost. We could claim it back on some big purchases, but most of our materials are VAT free, so doesn't seem worth the extra work. Ty Gwyn

Suppose in your business Chris it would be more complicated,but as long as you have all the receipts for sales and purchases it could work fine for you,
ie.your log sales would be 5% vat on sales and everything else 20%

But you`ll be able to claim 20% on all the fuel you purchase,red diesel for the tractors and the fuel for the trucks and the fuel your Son uses coming and going from work,and any sundries you buy,and its surprising how they mount up,its a nice little quarterly cheque,that one tends to forget about when making the original purchases.

Worth thinking about.
Nick

And, I think, the only other thing you have to do is a quarterly set of VAT accounts, and pay what you owe on time. They're more aggressive than the regular tax guys. VAT is the Queen's money that you have, rather than tax, which is your money, which you owe, I seem to remember being told. vegplot

We're a day late this quarter due to failing to remember banks don't transfer funds over the weekend. I'm awaiting a letter and possibly a fine.. Mistress Rose

I might look at it and see if it worth while again, but last time I looked it wasn't. If we buy in much timber it might be, as we have to pay 20% on that but only 5% on it as fuel, as you say Ty Gwyn. To date we haven't had to buy much in, so not much to gain there. Falstaff

If you're turnover is not enough to force you to register, I wouldn't do it !

Sure you'd get your VAT back on diesel and computer paper etc, But you'd have to lose 20% of your turnover (Your produce is rated at 20% ? ) and you'd have to do the paperwork for them !

If that means you'd have to put your prices up, why not just put your prices up anyway and pocket the difference ? Wink

That does mean you might have to introduce differential pricing according to whether you were selling direct, or to a middle man - but I expect that is in place in any case.
Mistress Rose

If we sell to someone wholesale we do give them a reduction so they can sell at a reasonable price. It is more that most of our materials come from the woods, so no VAT and then become subject to it when we sell them. As I said, I will look at whether it is worthwhile again as it wasn't last time I looked. We are not up to the VAT threshold, so it would need to be worth while long term.
       Downsizer Forum Index -> Energy Efficiency and Construction/Major Projects
Page 1 of 1
Home Home Home Home Home