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The Issue

According to FSB research, over a quarter of small businesses think that VAT is the most complicated tax they have to deal with. Many small firms have also told us they find calculating VAT burdensome and the rules on both input and output rates particularly confusing. For its part, FSB remains heavily focused on securing change within the EU while we remain a member. These two years provide a final window of opportunity to change laws across the EU that will become UK law, and also for rules across the EU27 to be more closely aligned to what UK small businesses need.

Action FSB have taken 

  • FSB is lobbying the Government to prioritise simplifying VAT post-Brexit. This was a key ask in our ‘Small Business, Big Ambition’ 2017 General Election Manifesto.
  • In 2015, the EU announced the establishment of a VAT ‘One-Stop-Mini-Shop’ (MOSS) scheme, which enables EU businesses to register for VAT cross-border trade with their domestic tax authority. FSB has lobbied the EU and HMRC to secure improvements to VAT MOSS, particularly so that the administrative burdens of microbusinesses may be reduced.

Our Ask

We believe the Government now has an opportunity to reform VAT in order to support greater investment, growth and exporting across the small business community.

The Government should continue to engage with the EU’s Action Plan on VAT to ensure mutual forms of cooperation may continue for the benefit of enhancing cross-border trade between the UK and European markets.

Related Links

Visit the VATguidance site