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Furious firms give Treasury their demand to close the VAT loophole
Archived article dated Tuesday July 25th 2006
The Forum of Private Business (FPB) stepped up the pressure on the Treasury as it presented fresh evidence of opposition to an offshore VAT loophole which is costing the Government and retailers millions of pounds.
The FPB is backing the campaign by a group of independent music retailers, who presented an open letter with the signatures of owners and managers of over a hundred companies, including two major chains, supporting them.
The loophole allows goods with a value of less than £18 to be individually imported to the UK from the Channel Islands without the imposition of VAT. They are typically sold online, having first been exported from the UK. The Chief Executive of the FPB, Nick Goulding, said small firms are suffering as a direct result. “Firms who sell goods such as DVDs and CDs from UK high streets have no such advantages and many are being driven out of business simply because they cannot compete with their rivals' artificially low prices.” he said.
The independent music retailers represent a cross section of the industry and include representatives from the chains FOPP and Music Zone. Music Zone has over a hundred retail outlets and Managing Director Steve Oliver said their demands are not outrageous.
“In simple terms all retailers want, surely not unreasonably, is for the re-introduction of a level playing field.”
Tagged as: forum of private business
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