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Europe wants your head?

VAT Threat to Helmets

 

Motorcycle helmet prices could rise significantly if the latest EU Commission proposals to rationalise VAT are accepted, warns the BMF.

Issuing the warning, the British Motorcyclists Federation say that this is because motorcycle helmets (currently zero rated but only within the UK), are no longer included in the list of goods under Directive 77/388/EEC that can carry a zero or reduced rate of VAT.

Writing to Economic Secretary John Healey MP, Departmental Minister for Customs and Excise, the BMF say that while it understands the need for some EU tax harmonisation, with the compulsory helmet laws that are in place, the UK practice of zero rating on helmets should in fact be applied across the whole of the EU as a pro-active safety measure and not removed as proposed.

The BMF say that irrespective of the need to simplify and standardise rates of VAT, it is morally wrong to be compelled to wear a motorcycle helmet and then be expected to also pay a tax on the purchase.

Say if you were to buy a £200 helmet then you will have to pay an extra £35 to cover the VAT, but with extra paperwork involved then manufacturers and importers will be putting the prices of the product up to cover that too!

A long time campaigner for the removal of VAT from replacement visors (visors are only zero rated when sold with a new helmet), the BMF has also been lobbying for zero rating on other legitimate motorcycling safety clothing, items which presently carry full-rate VAT.

Also included in the new proposals are children's clothing, automatically penalising any biker who dares to take their child out on the back of their bike - this now means VAT will be added to any clothing they need including a bike jacket, jeans, boots, gloves and helmet, which literally could add hundreds onto the cost of kitting out your child safely!

The BMF understands that the revised list of goods defined in what is known as Annex H are now to be agreed by member states during 2004 and so are calling on their 140,000 members to lobby their MP’s and MEPs on this important issue.

You can email and fax your MP HERE

The wide reaching proposals are part of a EU strategy to improve the operation of the VAT system across all member states. They are contained EU Council Directive (COM(2003) 397 final) issued this week, which amends Directive 77/388/EEC on reduced rates of value added tax. Also to lose their zero status are industrial safety footwear and helmets, cycle helmets and children’s clothing, all items that are zero rated, but only within the UK.

In a recent call to HM Customs and Excise we had a discussion with them and it seems that both them and the HM Treasury have the same stance on this. In a quote from them they say:

"The Commission proposal as it stands is unacceptable. All EU VAT proposals must be agreed unanimously and there is no question of us agreeing changes which do not fit in with our national interests and social objectives."

They wouldn't be drawn any further as to what this actually means, so let us have your views on this in the forum, and make sure that you use the fax your MP link to ensure that we all make our point of view known.

 


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