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Originally Posted by neilmarr
I was running a freelance press agency on Merseyside when VAT came in, Harry. I think it was around 1972. .....
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I was interested in your remarks and reminiscences, Neil.
I was working for a software company at that time. The introduction of VAT gave us a huge amount of business - even more than decimalisation which came in a couple of years earlier. The tax actually started in 1973, if I remember right.
Contrary to what most people think (including your friend Charlie Chaplin), the
principles of VAT are extremely simple. It was the paperwork that was complicated. But, to be fair, it has been greatly simplified over the years. The quarterly return was originally four pages, but it's now been reduced to one page, and many businesses don't even have to do it every quarter. There are also several simpler reporting systems for small businesses.
What gave VAT its reputation for complexity is, I think, the list of anomalies and exceptions and special cases. The classic example was the Jaffa Cake. Is it an item of food (and therefore zero-rated) or confectionery (which is positive-rated)?
You can see how that's persisted with books. Printed books are zero-rated, but electronic books aren't.
These days, I do the VAT for my own small businesses. It takes at most five minutes once per quarter. It's really very easy.