UK taken to court over reduced VAT rate

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The European Commission is referring the UK to the EU Court of Justice (ECJ) over its reduced VAT rate on the supply and installation of energy saving materials (ESM).

The Commission says that measure "goes beyond what is allowed under the VAT directive". 

Under EU rules, reduced VAT rates can be used by member states for the housing sector, as long as it's part of a social policy. 

However, the UK's use of the reduced rate on ESM specifically and its link to the Green Deal to improve energy efficiency has no provision in the VAT Directive. 

Referring the UK to the ECJ is the last step in the infringement procedure, according to the Commission. 

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Rachael Power
Community Correspondent
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By derek44
27th Feb 2013 11:19

It makes you wonder what the point is of the electoral vote doesn't it? The UK government genuinely seems to have lost all control over its, and our, affairs. The gesture for charities regarding VAT seems reasonable to me, but not for the EU bureaucrats it seems. A defeat of 'big society' by 'big bureaucracy'.

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