'Everyone has a different point of view, but no one has the answers'
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4 emovals firms are the only branch R
of road transport, outside public transport, to deal extensively with the general public. Private removals to the European mainland were zero rated until 1993. Since integration, VAT has been slapped on all cross-border moves in the EU. So the private individual who wants to move has had a tax put on his mobility. The removal Firm applies a direct tax which can add as much as 25% on a private move. The cowboy operator, who is not exclusive to Britain, does not charge VAT of course. It does not end there, however, The VAT levied on a private removal is based on the rate applicable at departure. So a British remover taking a private household out of Copenhagen, or even subcontracting the move to another carrier, must charge 25% VAT. Who does he hand it over to? He must register for VAT in Denmark, even for the occasional one-off job, and hire a fiscal agent, whose cost makes the VAT element an irrelevance. This is the tip of the iceberg. The VAT people don't want to know. The fiscal agents, even if they can be found, don't want to know either, at least not without a substantial indemnity bond. The public, most removers and many local customs officers are in total contusion. Everyone has a different point of view, but no one has the answers.
Every year we see the Government telling us how grateful we should be that the VAT threshold has been raised. Don't they realise that the higher the threshold the more fraud beneath it? We all know of cowboys who trade without VAT up to the threshold and then switch to another company name. In more sane European countries there is no threshold—everyone is inside the net. But at least the playing field is level.
They have another bonanza too. An Italian-based mover can do nearly 250,000 worth of business out of the UK before having to charge British VAT. In cold terms, whatever he bids, he will be at least 17.5% cheaper than his UK counterparts. I won't even discuss the disparity of diesel fuel prices, road tolls or vehicle taxation where in every case the UK operator comes off worse than his Euro colleagues. Our civil servants fob us off with meaningless and complacent processed responses to our arguments. Is there light at the end of the tunnel? Well, there was. Madame Scrivener in Brussels is alone in understanding that taxing mobility does not help create a unified union of people in work. But then, she doesn't work in Whitehall.
Now we've heard that she is being replaced as Commissioner of Taxation and her successor does not have to share her views or support the work done so far. Suddenly, we're back to square one.