Clause 196 relates to an element of VAT that is not quite as controversial as the VAT issues that we have focused on already this morning. I declare that I, along with other members of the Committee no doubt, receive support from the Parliamentary Research Service, which will, I understand, benefit from the changes.

The provision has the effect of exempting from VAT the supply of services by a group that consists of persons engaging in exempt or non-taxable activities, as long as the services are supplied to group members at cost and for the purpose of the activities. That is a technical description, but I guess that their experience of the PRS will indicate to Members the types of activity covered. The exemption will potentially benefit charities, universities, colleges, housing associations and businesses that undertake exempt activities, and we are happy to support the measure.