Press release: Freezing of VAT threshold welcomed
The Association of Taxation Technicians (ATT) has welcomed the Budget 2018 announcement that changes to the VAT threshold have been kicked into the long grass.
Today Chancellor Philip Hammond said the VAT registration threshold will be maintained at £85,000 for a further two years and that the Government will not look at a possible ‘smoothing mechanism’ until after Brexit.
Jon Stride, Co-Chair of ATT’s Technical Steering Group, said:
“We welcome the announcement that any change to the VAT threshold has been delayed for two years, especially with the stress many businesses face already because of ongoing uncertainty on Brexit and having to manage the transition to Making Tax Digital for VAT from April 2019.
”Any change to the VAT threshold will require a very detailed consideration of its implications not just for businesses but for all consumers.”
Notes for editors
- A joint survey of Chartered Institute of Taxation and ATT members gathered evidence to inform the organisations’ separate responses to the Treasury and was published in June 2018. Around 60 per cent of respondees gave their number one reason for small businesses managing the VAT registration threshold as being due to price pressure from non-VAT registered competitors. A total of 74 per cent of respondents to the survey thought that Making Tax Digital for VAT due to start next April was a further reason for small businesses to want to remain below the VAT threshold because most respondents thought it would increase the administrative burdens on business.