Dear Sirs

Whether or not an alcoholic drink made from stinging nettles is classified as a beer is not the question, “Family brewery facing axe as EU says your nettle beer’s not a beer”, 13 February 2011. The issue here is the UK authorities have decided not to grant a reduced VAT rate to this nettle beer in the same way as they do for cider.

Yours faithfully

Jonathan Scheele
Head of European Commission Representation in the UK

EU move threatens Poppy Appeal with a £500,000 tax bill
Tax plans by the European Commission could leave the Royal British legion facing a big VAT bill for Remembrance Day poppies, it emerged today
(Evening Standard, 10 November 2003, page 6)

EU to tax our poppies
Old soldiers were outraged last night over EU plans to tax Remembrance Day poppies.  The Royal British Legion’s annual appeal stands to lose more than £1/2million if the move goes ahead.  Brussels wants to slap VAT on the supply of all goods and services, even those from charities. 
(The Sun, 11 November 2003, page 22)
Even Remembrance Day poppies are fair game for a euromyth. No VAT threat exists to the Royal British Legion’s Poppy Appeal.  The European Commission has introduced new proposals to simplify the use of VAT across the EU.   Under these plans, however, a zero rate may still be applied to “the supply of goods and services …

REDUCED RATE OF FACTS

EU bars move to cut Church VAT
The Church of England faces soaring repair bills to its churches after the European Commission rejected government proposals to cut VAT.  To the dismay of church leaders, the commission has recommended that Churches should pay the full 17.5 per cent on repairs to listed buildings used as places of worship. Gordon Brown, the Chancellor, has argued that religious organisations should pay a reduced rate of five per cent.  Since 2001 the Treasury has been granting the Churches millions of pounds to make up the difference. 
(The Daily Telegraph, 9 September 2003, page 4)
Under the Listed Places of Worship Grant Scheme, the UK government provides financial support to churches that have had to undertake repairs.   This allows churches to reclaim 12.5% of the cost of repairs, in effect reducing VAT to 5%.    The scheme runs “very successfully” according to the Church of England.  …

Eurocrats want to slap VAT on kiddies’ clothes
VAT will be slapped on the price of baby clothes, newspapers, books and some foods under plans unveiled by Brussels last night.  EU chiefs want all member states to have the same tax levels for everything…And they plan to scrap Britain’s right to vary it.  That means EU laws could be foisted on us if a majority of countries backed them.
(The Sun, page 2, 15 March 2000)

Blair faces EU ambush over tax harmonisation
Tony Blair has become the victim of a political ambush on the eve of a European Union summit…by moves to abolish Britain’s national veto in key areas of taxation, VAT and social security policy.
(The Sunday Telegraph, page 2, 19 March 2000)
Despite the obvious delight of the sceptic press, there was no “ambush” and there is no proposal to “slap” the same tax levels on everything.  A contribution from the Commission to …

The price of children’s clothes will soar if Britain accepts that VAT will be slapped on them, as well as on food. Brussels will bulldoze us into a deal which also means small firms, tradesmen and self-employed will no longer be VAT exempt.
(The Sun, 30 November 1998, page 1)
“Brussels” cannot “bulldoze” EU taxation policy. Proposals from the Commission can only be adapted if Ministers from all fifteen EU Member States including the UK agree. There are no proposals to remove Britain’s zero VAT rating on food, children’s clothes, books and newspapers. The UK government could veto any such move.

Myth: Thanks to an EC directive, the UK Government is obliged to abolish the zero rate of VAT on books and newspapers at once.

Response: This is untrue. The relevant directive  permits those Member States that have implemented a zero VAT rate on specific products before 1.1.1991 to maintain that rate from 1.1.1993 for a period of four years.
Therefore, if the UK or any other Member State were to decide to abolish the rate now, it does so of its own initiative.

(*) – Directive 92/77/EEC