UK residents and the UK Marine Industry have been delivered devastating news by HMRC at a meeting recently held on 14 December 2022. The industry bodies that participated in this discussion included: the Association of Yacht Brokers and Agents (ABYA), Royal Yachting Association, British Marine, the Cruising Association, as well as other key VAT marine industry specialists.
During the meeting, HMRC Representatives confirmed that the Financial Secretary to Treasury, Victoria Atkins MP, has refused to make changes to the current HMRC policy which would allow UK residents who purchased VAT paid vessels in the EU prior to the end of the BREXIT Transitional Period, i.e. 31 December 2020, to bring those vessels back to the UK, without being charged VAT again.
ABYA, along with other industry bodies, have been lobbying HMRC for the past three years for important and fair changes. This plight became more rigorous over the past two years since it was announced, just two weeks before BREXIT, that grandfather rights allowing people to return their boats without being charged VAT again, were withdrawn. All despite promises made by HMRC previously, that they would be in place.
ABYA Chairman, Peter Norris said “The announcement today will have a significant financial impact on UK boat owning residents, as well as the UK marine industry, which is already suffering from increased costs and a shortage of product within the UK market place. The decision by the Minister seems not to be aligned with Government policy as stated by the Prime Minster and his Chancellor, to try and grow the economy. Had these vessels been allowed to return, they would have invested money in the UK marine industry on services and berthing, which ultimately would have generated additional VAT income as well as additional corporation tax.”
When challenged at the meeting, HMRC refused to provide any information on how this impactful decision was reached, as well as what the Ministers reasons for refusing to implement the requested changes to the HMRC policy were.
ABYA, through its contacts at HMRC, have been calling for an urgent meeting with the Minster since her appointment in October 2022. To-date, all have been blocked. All of the industry bodies present at the meeting, called for an urgent face-to-face meeting with the Minister, to discuss her decision and to seek an amicable way forward.
ABYA Chairman, Peter Norris said “We need to explain to our Yacht Brokering members, both in the UK and Europe, what the justification behind the Minsters decision is, because they will need to articulately explain her reasons to our UK customers. If the Minster refuses to discuss the rationale for her decision in a face-to-face meeting, then we, along with all the other industry bodies, will have no choice but to appeal through a freedom of information request, that we be given access to all of the documentation submitted to the Minster, as well as the minutes of the meetings held. This will be followed by us then petitioning industry Ministers to seek the rational for her decision at the next available Treasury question time.”
HMRC Representatives at the meeting have agreed to provide feedback to the Minister that outlines the level of betrayal and frustration felt by all of the marine industry bodies in attendance.
Peter Norris Fellow ABYA,