Treasury Minister Anne Craine MHK announced today (Thursday, December 16) that, following successful negotiations with the United Kingdom Treasury, the Island is to retain its experimental VAT reduced rate of 5% on the repair and refurbishment for domestic property on a permanent basis.
Mrs Craine said: “I am delighted that I can now remove any uncertainty associated with this matter. We believe that the retention of this rate of tax will continue to be a stimulus for the local building trade in these difficult times”.
The Collector of Customs and Excise, Denis Maxwell, added: “There is no doubt that the reduced rate for domestic repairs has achieved what it set out to do, namely reduce activity in the shadow economy and encourage employment. We therefore welcome the United Kingdom’s agreement to make the rate a continuing feature of the Island’s indirect taxation system”.
The existing arrangement was due to expire on 31st December 2010. Article 2 of Directive 2009/47/EC requires Member States wishing to continue to use the 5% rate with legislation etc adopted to implement the change and to make reference to the Directive in any legislation or associated material.
The Isle of Man Public Notice relating to the reduced rate can be found at: http://www.gov.im/lib/docs/treasury/customs/reduced_rate_2006.pdf
Ends
Thursday 16th, December 2010 10:23pm.
