Power to provide

KEY POINTS

• Non-EU business and VAT representatives.
• Isle of Man charities will benefit from VAT relief.
• VAT rate on women’s sanitary products to be reduced.

The fifth sitting of the Public Bill Committee’s debates on Finance Bill 2016 started with clause 111 ‘VAT: power to provide for persons to be eligible for refunds’. This clause might not trouble many Taxation readers because it deals with the ability of non-departmental public bodies and the like to recover VAT incurred on cost-sharing arrangements.

Rebecca Long Bailey (Labour) was concerned that some bodies would lose funding as a result.

David Gauke (the financial secretary to the Treasury) explained that the aim of the clause was to encourage public bodies to share back-office services if this would result in economies of scale. Because they do not carry on a business some bodies are...