Chancellor urged to end VAT on rescue services
Chancellor urged to end VAT on rescue services
THE SNP yesterday urged Gordon Brown to “show some Christmas spirit” by ending the imposition of VAT on search-and-rescue charities such as the RNLI.
Alex Salmond, SNP leader, said the £3.2m in Vat the RNLI paid the chancellor last year would have been enough to run the lifeboat station in Peterhead for 13 years.
Under current Treasury rules, the RNLI, as a charity, is zero-rated for VAT for building lifeboats and their stations but is liable to pay it on training crew and repairs and maintenance.
The issue was highlighted earlier this year by the House of Commons transport committee, which urged the government to exempt search-and-rescue charities from paying VAT.
MPs said if recovering the VAT was too complex to avoid, a grant could be given to offset the cost to charities.
In October, ministers rejected the idea, saying it was not “a practical or affordable way of targeting the support available for charities.”
They adopted the line held by governments for the past 20 years: it is simply too costly to reimburse all 250,000 charities and there is no fair and principled basis to exempt just a few special cases, such as RNLI.
More: theherald.co.uk