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Impact on VAT receipts of Fleming judicial ruling
28 July 2009
Text of request
Amount and basis of provisions for the impact on VAT receipts in 2009-10 and 2010-11 of the Fleming judicial ruling.
Text for disclosure
The Budget 2009 forecast for VAT receipts included an allowance for repayments in this connection of £4.8 billion: £2.7 billion for 2009-10 and £2.1 billion for 2010-11.
The estimate was based on:
- the existing analysis of claims received well before the deadline;
- for those received in the run up to the deadline for new claims, a sampling exercise to determine the number of duplicate claims received, the average value of claims, the time period covered (which would affect the exposure to statutory interest);
- a survey of the Large Business Service’s Sector Lead Officers to identify any individual claims above £20m notified to them. Each of these was individually examined to determine the likely amount to be repaid after verification; and
- HMRC’s provisional assessment of the likelihood of success of the new claims, based on both evidence from previously verified claims
and an examination of the sample of new claims.
These provisions will be updated in the 2009 Pre-Budget Report to reflect latest information on these factors.
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