Thursday, December 04, 2008

VAT Chance Of A Xmas Prezzie From TDC?

Holy VAT inspectors! Reader Mikey has sent me a cutting from a recent edition of the Northern Echo headlined: Councils Urged To Cut Parking Fees. The story kicks off thus:

Local authorities must pass on the VAT cut announced in last week's Pre-Budget Report to help sustain small businesses and the local economy over Christmas, a business support organisation has said. The Federation of Small Businesses (FSB) said it is concerned by reports that many local authorities are not intending to pass on the 2.5 per cent VAT reduction on their parking charges.

Mikey says: 'This got me wondering whether your own beloved local authority had passed on Chancellor Darling's VAT reduction which came into force on Monday?' Hmm. Good question Mikey! A quick snoop around the Uranians' website revealed no such festive, tax-related announcement. And a check on their fees and charges showed they're still implementing 2008-9's tariff for car park season tickets, with a rather nebulous 'Charges include VAT', but no mention of a percentage. A similar perusal of CIPFA's (the leading public sector accountancy body's) website elicited little guidance for councils, in fact not much more than an announcement that the rate had dropped.

Still, I guess we have to trust that the CIPFA brains at Thanet Council know what they're doing! Meanwhile, to get us all in the spirit, here's a rather fetching festive photo of the Chancellor:


Anonymous said...

Now this looks like a job for a people friendly paper pushing expert. I imagine that TDC could, with the right sort of lever, be forced to drop the fees.

anne accountant said...

As I understand it local authorities are not obliged to pass on the VAT reduction for parking fees, it is a matter for policy decision. You can imagine the cost of changing all those parking meters just to reduce the price by a few pence. It would however make a difference if you are a business buying an annual season ticket for say £520.

As for other VATable services councils provide the guidance is, I believe, the same.

Anonymous said...

Brains at TDC - did I read your last paragraph correctly?

Eastcliff Richard said...

CIPFA brains.

It's pronounced 'Sipfer'.

Nige said...

I can see three possible solutions.
Do nothing (the most likely).

Reduce the parking rate by 5p or 10p per hour and publicise the fact that parking charges have been reduced by more than the vat decrease to help regenerate town centre shopping (the best political option?).

Thirdly offer to give a nice shiney pound coin if you hand over an accumulated £47 of parking tickets dated within the vat decrease. (mathematically correct i think)

I see no reason why anyone paying for a permit or season ticket now should not pay a lesser amount. For existing holders, well they wouldn't expect to be levied if vat went up, so no refund! However, they could easily benefit when the vat rises again and they have renewed at the lower rate.

CIPFER brains.... is that like sucking them out through a straw? If so I didn't realise so many of out local politicos had actually been members :s


Michael Child said...

My gripe with this whole VAT reduction thing is because the reduction is so small and the changes so expensive to administer, it was about the least cost effective way of injecting the money into the economy. Frankly I am just glad that books don’t carry VAT so I don’t have to re price 30,000 of them or do an extra calculation at every sale.

bertie Biggles said...

From TDC Cabinet Meeting on 6 Nov 2008 about Northdown Road Parking:
" Cabinet recommend to Council that the parking charges are retained at their published level and that officers investigate the EXTENSION of the charges into currently uncontrolled areas if they can be introduced practically".
Whose really worried about the VAT reduction?

Michael Child said...

Bertie I think part of the problem here is that while TDC gets the parking revenue it doesn’t get any of the business rates, so there is no financial incentive for them to make businesses prosper by reducing parking fees.

Anonymous said...

vat is only charged on off street parking

Anonymous said...

We could just nag

here is a tool to do just that.