Scappage scheme gets round the EU VAT rules
Posted on 23 April 2009 by
We now have confirmation from yesterday’s budget papers that the Government will give £1,000 to anyone who owns a car which is at least 10 years old, and they have owned for at least a year, if they scrap it and buy a new one, subject to the manufacturer at least matching the £1,000.
Although anyone owning an old car who chooses to replace it with a new one is likely to buy a relatively cheap car, most will still spend more than the £6,667 needed to generate £1,000 of VAT for the Government, so that the Government is not a net loser.
Therefore, this is just a clever way to get round the problem that the UK no longer has the ability to adjust VAT as it wishes, because we are in hock to the EU on taxes such as VAT and would have to go down on bended knees to ask its permission to cut VAT on cars, which would in any case probably be refused!
Categories: Miscellaneous
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colin martin says:
Unless they simply take away another incentive to make up for their £1k.
As for your comedian post, Brown's probably done enough at G20 to get a retirement job at the IMF.
Whilst Darling can always make a good living giving after-dinner speeches on "working with Gord".
PS: Keep up the good work, very good blog-posts.
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