Sales from student union campus shops

The Loughborough Students’ Union (LSU) claimed that sales of stationery art materials and other items from shops it operated on the university campus were exempt from VAT as supplies closely related to the supply of education (VATA 1994 Sch 9 group 6). The First-tier Tribunal dismissed its appeal against HMRC’s refusal to repay the output tax so the union appealed to the Upper Tribunal.

The first question was whether the LSU was an ‘eligible body’ for the purpose of group 6 note 1(e). The First-tier Tribunal had decided it was not. Mrs Justice Rose said: ‘The apparent breadth of note 1(e) in the sense that it does not expressly require the eligible body to have anything to do with education clearly perplexed the First-tier Tribunal.’ It had concluded that the domestic provisions were too generous and implemented Art 132 of the Principal VAT Directive incorrectly.

But she...