Vol. 437 No. 6
205 Mr. Yates asked the Minister for Finance the cost of reducing the 21 per cent rate of VAT on adult clothing and footwear from 21 per cent to 12.5 per cent; and if, arising out of the 1993 Exchequer returns, the anticipated increase in VAT receipts resulting from the raising of the VAT rate from 16 per cent to 21 per cent occurred.
The cost to the Exchequer of reducing the 21 per cent rate of VAT on adult clothing and footwear to 12.5 per cent is estimated at £50 million in 1994 and £80 million in a full year. Where the 1993 yield is concerned, VAT receipts are not compiled in a manner which enables the yield from specific commodities to be identified. However, on the basis of non-VAT derived data, I am confident that the anticipated VAT yield from clothing and footwear was realised last year.
