Explanatory note

(This note is not part of the Regulations)

These Regulations amend, from 1 April 2000, the Value Added Tax Regulations S.I. 1995 No. 2518.

The VAT charged on importations of goods from outside the member States is payable as if it were a duty of customs. Therefore relevant customs legislation applies to import VAT unless it is excepted or adapted by regulations (or there is a contrary intention).^f1

From 1 April 2000 national customs legislation^f2 will–

(a)

enable Customs to recover interest on an unpaid customs debt, and

(b)

require Customs to pay interest if they must repay a person an amount relating to customs duty.

These provisions will not apply to import VAT. Regulations 3, 4 and 5 add them (and their associated Community measures^f3) to the existing lists of customs legislation^f4 which is excepted from applying to import VAT.

Regulation 4 also provides continuity for an existing import VAT exception^f5 that is currently found in regulation 119 (removal from warehouse).

At the same time, new customs rules^f6 will permit Customs to recover a repayment of customs duty issued to a person who was not entitled to it. Recovery will not be allowed more than 3 years after the amount was issued (unless Customs give written notice before then). Regulation 6 confirms that these rules will apply to relevant import VAT^f7.

Regulation 6 also provides continuity for an existing import VAT adaptation^f8 that is currently found in regulation 121 (valuation).

Annotations

Footnotes

f1: Sections 1(4) and 16(1) of the Value Added Tax Act 1994 (c. 23).
f2: Sections 126, 127 and 130(3) of the Finance Act 1999 (c. 16). Section 130(3) inserts a new paragraph (f) to section 197(2) of the Finance Act 1996 (c. 8) (amended by the Finance Act 1997 (c. 16)). Also S.I. 2000/632.
f3: Parts of Articles 232 and 241 of Council Regulation (EEC) No. 92/2913 (the Community Customs Code) (O.J. L. 302, 19.10.92, p.1).
f4: S.I. 1995/2518 regulations 118, 119 and 120.
f5: Regulation 119 of S.I. 1995/2518 excepts regulations 16(4) and (5) and 19(1)(b) of the Excise Warehousing (Etc) Regulations S.I. 1988/809. Regulation 4 incorporates this into a new regulation 119(a).
f6: Section 129 of the Finance Act 1999 (c. 16).
f7: It does this by substituting a new regulation 121 in S.I. 1995/2518. Paragraph (3) provides that section 129 of the Finance Act 1999 shall be regarded as applying to any relevant import VAT.
f8: Regulation 121 of S.I. 1995/2518 adapts section 125(3) of the Customs and Excise Management Act 1979 (c. 2). Regulation 6 incorporates this into a new regulation 121(2).