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Corkers
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U-turns

Caravan tax

  • How George Osborne’s new budget will affect VAT on caravans – Caravan Times, 22 Mar 2012
  • Caravan tax u-turn – ITV News, 28 May 2012

In the March budget, George Osborne announced a tax on caravans.

The Caravan Times reported:

As part of his annual budget, chancellor George Osborne announced various change in the tax system yesterday (March 21st), and several previously un-taxed goods including static caravans will now be hit with the standard 20 per cent rate of VAT.

This change will take place on October 1st of this year, and could also have an effect on some larger touring caravans to go along with the previously zero-rated static caravans.

A caravan that is “designed and constructed for continuous year-round occupation” will still be zero-rated, and exempt from the VAT but all other static caravans will be taxed at the standard rate, according to HM Revenue and Customs (HMRC).

However, the government has now u-turned on the caravan tax, as ITV News reports:

After complaints it would harm the East Yorkshire economy and cost hundreds of jobs the government has had a re-think over the so-called “caravan tax”. The plan had been to introduce 20% VAT on the sale of static caravans. Instead, this will be reduced to 5%. It is going to be introduced in April 2013.

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