Euro parcel row hots up
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• The row about VAT changes in the European Community is escalating with furious parcels carriers complaining that they will be competing on inferior terms to the Post Office.
The parcels carriers believe that after 1 January 1993, when VAT is levied on transport services within the Community, they will have to charge customers VAT on documents delivered — but the Post Office will be exempt.
They are also worried that a consultation document on postal services within the EC will allow for greater subsidies to national postal services, as well as crosssubsidies between member states. "We want to compete on the same terms as postal services — not with one hand tied behind our backs," says Bertie Coxall, honorary president of the Association of International Courier and Express Services, whose members include TNT and Federal Express.
AICES is part of a Government-backed delegation going to the Continent next month to lobby the commission. Led by the Government's Simplification of International Trade Organisation (SITPRO), the delegation includes the FTA, the RHA, the British International Forwarders Association, the CBI and representatives from shipping and the airlines.
AICES claims that present ground rules are also discriminatory, with parcels carriers having to itemise every item for VAT at the point of their import and export.
By way of contrast, says Coxall, packages sent via the Post Office may be looked at by Customs "but there is a lot of difference in that and employing people to calculate liability and duty on every package".
Farce'force agrees that the present system exempts post from VAT itemisation, but says Customs checks can slow it down: "After January 1993 the importer will become responsible for VAT, putting us and commercial parcels carriers on a level playing field," says Chris KallaBishop, Parcelforce's international commercial manager. 0 Parcelforce says it is gearing up for the Single Market in 1992 by extending its guaranteed 48hour UK service. Kalla-Bishop says it is also simplifying its Customs clearance documentation for its non-urgent market and is talking to European postal administrations about partnership arrangements for its standard service.