Fire Service VAT

  morddwyd 08:33 29 Apr 15
Locked

Now I know there must be a valid reason, and various financial pundits have explained it, but I still can't for the life of me understand why the fire service in Scotland has to pay VAT to the UK Treasury while fire services in England and Wales do not.

Is there an economist out there who could put it in words of one syllable for me?

  john bunyan 08:48 29 Apr 15

Some blame the SNP!! See

VAT on Police and Fire

  morddwyd 08:56 29 Apr 15

The Human Rights Campaign at Glasgow Uni?

A good authoritative source!

Methinks we're getting awfully near the bottom of the barrel in reasons to denigrate Nicola Sturgeon!

  john bunyan 09:09 29 Apr 15

Mea culpa!!

  Aitchbee 09:30 29 Apr 15

Off subject slightly but maybe the Scots Firemen should follow their Irish counterparts in charging for emergency callout services.

click here

  Pine Man 11:23 29 Apr 15

The cash for free university education, free prescriptions etc has to come from somewhere.

  morddwyd 11:32 29 Apr 15

Yes but VAT goes to the UK Treasury.

Are you saying that VAT levels are dependent on tuition fee levels?

That confuses me even more!

  Pine Man 11:43 29 Apr 15

Are you saying that VAT levels are dependent on tuition fee levels?

No, my comment was tongue in cheek and meant to suggest that if Scotland has enough in their budget to provide free university and prescriptions then it is too generous and maybe the Treasury is clawing some back by charging VAT on the Fire & Police;-)

  Forum Editor 14:12 29 Apr 15

I thought this was pretty clear.

In order to qualify for the s.33 scheme an eligible body must be funded directly from local taxation. The scheme was originally set up to stop the VAT on these services from becoming a burden on local taxation.

Scottish Fire and Police services are to be centralised, and responsibility for funding will therefore be moved away from local authorities, so the services will no longer meet the s.33 criteria.

No problem, you might think - it can all be solved with a simple bit of legislation, but unfortunately EU member states cannot simply alter the VAT rules within their borders to suit themselves. They can alter the VAT rate, but not the eligibility rules - we cannot zero rate anything that isn't already zero rated.

  john bunyan 15:16 29 Apr 15

I notice that in Scotland, different services are included in Council Tax than in England. I looked at random in Aberdeen and Birmingham. In Aberdeen, water and waste water are included in the Council tax charge (at £278 and £323 for band F). In Birmingham, Water and waste water are not in the Council tax bill, but Fire and Rescue, Police are indeed in there at £79 and £153 respectively, plus a Parish precept at £48, again for band F.

In my case I pay a higher sum for waste water, in particular.

The point is that the items included in Council Tax are different in the two countries so comparisons are difficult . It would be worth looking at the history of this issue and when and why the charges were centralised, and, presumably come from the total Scottish precept. The VAT, of course, goes to the Treasury, so no doubt Scotland get some back from the same Treasury as part of the Barnett formula arrangement.

  bumpkin 15:33 29 Apr 15

FE has clarified the original point regarding VAT. Other taxes are a different issue.

This thread is now locked and can not be replied to.

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