BREXIT MEANS WE RUN OUR OWN COUNTRY AGAIN
Summary:
In March of 2022, the then Chancellor Rishi Sunak announced that VAT would be reduced to zero on green energy purchases such as solar panels and heat pumps. Women’s sanitary products also had VAT removed from them, in January 2021. A member state could not independently implement such VAT policies from within the EU. Would not have been possible due to EU rules on VAT and taxation.
Explanation:
Following the UK’s departure from the EU, the government has introduced several policies where VAT has been either reduced or removed completely – either to correct what is seen in the UK to be a historical oversight and miscategorisation, or to encourage the uptake of a particular type of product.
In January 2021, VAT was removed completely from Women’s sanitary products.
In March 2022, VAT was removed for green energy purchases such as for solar panels and for heat pumps.
Though EU member states are able to determine their own rates of VAT to be charged in their countries, there are minimums in place that member states cannot go below without prior approval and an EU-wide agreement for the same treatment.
The changes that the UK has made to VAT, would not have been possible to make unilaterally without having left the EU.
Reference: https://fullfact.org/economy/solar-installations-vat-eu/
Reference: https://independent.co.uk/climate-change/news/rishi-sunak-vat-green-homes-b2042181.html
Reference: https://www.streetsweb.co.uk/about/news/2024/jan/11/vat-on-period-products-scrapped/