asked the Minister for Finance the effect on the Exchequer of the agreement at the EC Council of Finance Ministers on 9 October 1989 that VAT will be paid by importers when goods are delivered and not at the border.
Written Answers. - Importers' VAT.
45.
The precise administrative arrangements and controls to be used in order to apply VAT to the recipient of goods in the country of destination, in the absence of frontier controls, have still to be elaborated and decided upon. However, in principle the system for payment of VAT at point of import would have to be discontinued. In that event there would be a once-off cash flow loss of about £140 million (in 1988 terms) in the first year. This loss is not included in my Department's figure of £600 million which is the estimated annual ongoing cost of approximation of indirect taxes under the EC Commission's present proposals.