VAT: Imports

Treasury written question – answered on 14th September 2020.

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Photo of Lord Strasburger Lord Strasburger Liberal Democrat

To ask Her Majesty's Government what action they took and when to address concerns raised by Richard Allen and others that Low Value Consignment Relief (LVCR) was being used for a purpose for which it was not intended; what estimate they have made of (1) the cost to the Exchequer of misuse of LVCR not being addressed sooner, and (2) the number of retailers who did pay VAT and went out of business as a result of the misuse of LVCR by others.

Photo of Lord Agnew of Oulton Lord Agnew of Oulton Minister of State (HM Treasury), Minister of State (Cabinet Office)

In April 2012 the Government took action to remove Low Value Consignment Relief (LVCR) for goods imported from the Channel Islands. Estimates were published at the time showing yield from this measure to be £90 million in 2012-13.

From 1 January 2021 the Government will be introducing changes that will see the removal of LVCR from all imports and make online marketplaces liable for VAT on low value imported goods sold through their websites.

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