VAT & Duty update


Nigel Roberts

Nigel Roberts

VAT Director and Head of VAT & Duty

29 October 2018


    Despite no headline grabbing announcements on VAT & Duty in the Autumn Budget - with all to come when Brexit changes come into effect - over £1bn of extra tax take over the next five years is planned to come from further clamping down on what the Government refers to as VAT avoidance, evasion and unfair outcomes. 

    The main VAT & Duty changes announced in the Budget are: 

    1. Despite strong pre-Budget rumours, there has been no change in the VAT registration threshold, which is frozen at £85k pa until April 2020. Some good news for small businesses struggling to deal with MTD and Brexit uncertainties.
    2. All alcohol duties are frozen on beer, cider and spirits, but wine will increase in line with RPI. Some good news for UK brewers and distillers, but they might have hoped for more.
    3. Fuel duties all frozen, as announced previously at the Conservative Party conference.
    4. Tobacco duty up by RPI plus 2%.
    5. Remote Gaming Duty on online / TV gambling up from 15% to 21%.
    6. Consultation on new “plastics tax” to be introduced from April 2022 on sale and import of plastic packaging with less than 30% recyclable content, but NO coffee cup tax.
    7. Extension of VAT grouping eligibility to include non-corporates.  This will be effective from 1 April 2019.
    8. Introduction of a reverse charge in the construction industry to prevent losses through missing traders in the supply chain. This will be effective on or after 1 October 2019.
    9. Simplifying the VAT treatment of vouchers.