Katy Clark MP has called on the Tory-Lib Dem UK Government to stop pocketing millions-of-pounds in Value Added Tax (VAT) from the Scottish Fire and Rescue Service.
The Westminster government began charging VAT to the emergency organisation when Scotland’s eight fire brigades were merged into one national body through the Police and Fire Reform (Scotland) Act 2012, which was passed by the Scottish Parliament. It is estimated the Scottish service is currently paying around £10m a year to the UK Treasury.
In 2012, when the Tory-led Government indicated its intention to charge VAT, the SNP Scottish Government branded the move “a naked cash grab”, adding, “Westminster is not content with imposing huge cuts on our public sector, it also wants to make Scotland’s police and fire authorities the only services in the UK unable to recover VAT.”
Her Majesty’s Revenue & Customs (HMRC) has rejected a request from the SNP Government that sought to place the Scottish Fire and Rescue Service and the Scottish Police Authority on the same footing as services in other parts of the UK, where VAT payments can be recovered.
Now, local Labour MP Ms Clark has tabled a question to George Osborne, Tory Chancellor of the Exchequer, calling for the UK Government to bring forward legislation to create a level playing field and allow the Scottish Fire and Rescue Service to secure VAT refunds.
Ms Clark said, “There is no sensible reason why the Scottish Fire and Rescue Service should not be eligible for a VAT refund. Other blue-light organisations are eligible for a refund and to penalise the Scottish organisation in this way places considerable financial pressure on an essential public service.”
Calling for the Chancellor and UK Government to “think again” on the matter, the North Ayrshire & Arran MP said she hopes “common sense will prevail”.