EU VAT Ruling

[SRE]

Maybe I'm a cynic, but if the government can change the vat rate for everyone overnight from 17.5% to 10% what's to stop them increasing the renewable rate overnight? We're just do domestics so we won't be caught in the middle of big projects but it'll kill our market.

 

[Gavin A]

Maybe I'm a cynic, but if the government can change the vat rate for everyone overnight from 17.5% to 10% what's to stop them increasing the renewable rate overnight? We're just do domestics so we won't be caught in the middle of big projects but it'll kill our market.

commercial is already at 20% but not an issues as companies can reclaim the VAT.

 

[SRE]

Of course! It's been a long year!

 

[The Solar King]

There is a lot going on. Political lobbying just one aspect. It also appears very sound advice on case law given to HMRC by the Sustainable Energy Association was not used by their lawyers.

Appears to be strong grounds for appeal.

Will keep you posted.

 

[The Solar King]

If you are talking to or lobbying anyone on this, these are the points to emphasise:

1. The principle behind the judgement makes no sense, even if the ECJ was interpreting the letter of the law.
2. The Commission consulted on allowing such derogations to the VAT directive two years ago, so there seems to be a mismatch of objectives.
3. The UK Government needs to redouble its efforts to overturn the decision and should listen to the arguments that industry has provided.
4. The decision covers a wide range of energy saving measures and will have a significant impact on efforts to improve energy efficiency performance of the existing building stock. (e.g. through the Green Deal) affecting particularly those in fuel poverty.
5. In any 'negotiations' with the Commission the Government needs to treat solar technologies in the same way as energy efficiency measures, as the energy bill reduction they give consumers makes a significant social impact.
6. The Government should resist implementing the ECJ decision as long as possible and should press the Commission to reform VAT rules to allow the reduced VAT rate for energy saving measures, so as to bring these on par with the reduced VAT that domestic energy supply enjoys.

There is a meeting at the end of the month at HMT/HMRC and pre-meetings in advance of this to fully prepare the ground.

Will report back anything as it becomes known.