Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of making costs associated with the organisation of remembrance services exempt from VAT.

VAT has been designed as a broad-based tax on consumption, and the 20 per cent standard rate applies to the vast majority of goods and services.

It would be administratively challenging for suppliers to identify and apply a different VAT treatment to supplies based on the type of event and for HMRC to ensure that the VAT treatment and VAT accounting is applied correctly throughout the supply chain. Businesses and organisations in the supply chain are normally able to recover VAT on costs. However, they are unable to recover the VAT on costs used in making exempt or out of scope supplies.

The Government keeps all taxes under review and welcomes representations to help inform future decisions on tax policy, as part of the tax policy making cycle and Budget process.