Finance Act 1999

Part I — Excise duties

Alcoholic liquor duties

Rate of duty on sparkling cider

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• (1) In section 62(1A)(a) of the Alcoholic Liquor Duties Act 1979 (rate of duty per hectolitre on sparkling cider of a strength exceeding 5.5 per cent.), for “£45.05” there shall be substituted “ £161.20 ”.

• (2) This section shall be deemed to have come into force at 6 o’clock in the evening of 9th March 1999.

Hydrocarbon oil duties

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• (1) In section 6(1A) of the Hydrocarbon Oil Duties Act 1979 (rates of duty on hydrocarbon oil)—

• (a) in paragraph (a) (light oil), for “£0.4926” there shall be substituted “ £0.5288 ”;

• (b) in paragraph (b) (ultra low sulphur diesel), for “£0.4299” there shall be substituted “ £0.4721 ”; and

• (c) in paragraph (c) (heavy oil which is not ultra low sulphur diesel), for “£0.4499” there shall be substituted “ £0.5021 ”.

• (2) In section 8(3) of that Act (road fuel gas), for “£0.2113” there shall be substituted “ £0.1500 ”.

• (3) In section 11(1) of that Act (rebate on heavy oil)—

• (a) in paragraph (a) (fuel oil), for “£0.0218” there shall be substituted “ £0.0265 ”; and

• (b) in each of paragraphs (b) and (ba) (gas oil which is not ultra low sulphur diesel and ultra low sulphur diesel), for “£0.0282” there shall be substituted “ £0.0303 ”.

• (4) In section 13A(1A) of that Act (rebate on unleaded petrol)—

• (a) in paragraph (a) (higher octane unleaded petrol), for “£0.0050” there shall be substituted “ £0.0055 ”; and

• (b) in paragraph (b) (other unleaded petrol), for “£0.0527” there shall be substituted “ £0.0567 ”.

• (5) In section 14(1) of that Act (rebate on light oil for use as furnace fuel), for “£0.0218” there shall be substituted “ £0.0265 ”.

• (6) This section shall be deemed to have come into force at 6 o’clock in the evening of 9th March 1999.

Bearer instruments.

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• (1) In section 13A(1A)(a) of the Hydrocarbon Oil Duties Act 1979 (rebate on higher octane unleaded petrol), for “£0.0055” there shall be substituted “ £0.0367 ”.

• (2) This section comes into force on 1st October 1999.

Rate of insurance premium tax.

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• (1) In section 15(1) of the Hydrocarbon Oil Duties Act 1979 (drawback of duty on exportation, shipment as stores or warehousing of hydrocarbon oil and related articles), the word “exportation,” shall be omitted.

• (2) This section has effect in relation to any exportation on or after the day on which this Act is passed.

Tobacco products duty

Rates of tobacco products duty

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• (1) For the Table of rates of duty in Schedule 1 to the Tobacco Products Duty Act 1979 there shall be substituted—

1. Cigarettes	An amount equal to 22 per cent. of the retail price plus £82.59 per thousand cigarettes.
2. Cigars	£122.06 per kilogram.
3. Hand-rolling tobacco	£87.74 per kilogram.
4. Other smoking tobacco and chewing tobacco	£53.66 per kilogram.

• (2) This section shall be deemed to have come into force at 6 o’clock in the evening of 9th March 1999.

Betting and gaming duties

Lending by Revenue Accounts to National Loans Fund.

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• (1) In section 7(1) of the Betting and Gaming Duties Act 1981 (rate of pool betting duty), for “26.50 per cent.” there shall be substituted “ 17.50 per cent. ”

• (2) This section has effect in relation to bets the stake money on which is or has been paid on or after 28th March 1999.

Rates of gaming duty

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• (1) For the Table in section 11(2) of the Finance Act 1997 (rates of gaming duty) there shall be substituted—

Part of gross gaming yield	Rate
The first £462,500	2½ per cent.
The next £1,027,500	12½ per cent.
The next £1,027,500	20 per cent.
The next £1,798,500	30 per cent.
The remainder	40 per cent.

• (2) This section has effect in relation to accounting periods beginning on or after 1st April 1999.

Vehicle excise duty

The general rate of vehicle excise duty

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• (1) In sub-paragraph (2) of paragraph 1 of Schedule 1 to the Vehicle Excise and Registration Act 1994 (the general rate), for “£150” there shall be substituted “ £155 ”.

• (2) For the word “The” at the beginning of that sub-paragraph there shall be substituted “ Except in the case of a vehicle having an engine with a cylinder capacity not exceeding 1,100 cubic centimetres, the ”.

• (3) After that sub-paragraph there shall be inserted the following sub-paragraph—

(2A) In the case of a vehicle having an engine with a cylinder capacity not exceeding 1,100 cubic centimetres, the general rate is £100.

• (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (5) Subsection (1) above has effect in relation to any licence issued after 9th March 1999; and subsections (2) to (4) above have effect in relation to any licence taken out for a period beginning on or after 1st June 1999.

Rates of duty for goods vehicles

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Schedule 1 to this Act (which makes provision for new rates of vehicle excise duty for goods vehicles etc.) shall have effect.

Goods shipped etc. as stores

Goods for sale on board ships or aircraft

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• (1) For subsection (4) of section 1 of the Customs and Excise Management Act 1979 (goods for sale on board ships or aircraft to be treated as stores) there shall be substituted the following subsections—

(4) Goods for use in a ship or aircraft as merchandise for sale to persons carried in the ship or aircraft shall be treated for the purposes of the customs and excise Acts as stores if, and only if— (a) the goods are to be sold by retail either— (i) in the course of a relevant journey, or (ii) for consumption on board; and (b) the goods are not treated as exported by virtue of regulations under section 12 of the Customs and Excise Duties (General Reliefs) Act 1979 (goods for use in naval ships or establishments). (4A) For the purposes of subsection (4) above a relevant journey is any journey beginning in the United Kingdom and having an immediate destination outside the member States. (4B) In relation to goods treated as stores by virtue of subsection (4) above, any reference in the customs and excise Acts to the consumption of stores shall be construed as referring to the sale of the goods as mentioned in paragraph (a) of that subsection.

• (2) This section shall be deemed to have come into force on 1st July 1999 but shall not have effect in relation to any shipment of goods before that date.

Drawback of duty on shipment

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• (1) In section 2 of the Finance (No. 2) Act 1992 (power to provide for drawback of excise duty), in subsection (1), after “provision” there shall be inserted “ (a) ”, and after “Kingdom” there shall be inserted

; and (b) conferring an entitlement to drawback of duty, in prescribed cases, on the shipment as stores, or warehousing in an excise warehouse for use as stores, of goods chargeable with duty

.

• (2) In subsection (5) of that section, for “ “goods” has the same meaning” there shall be substituted “excise warehouse”, “goods”, “shipment”, “stores” and “warehousing” have the same meanings ”.

• (3) Section 132 of the Customs and Excise Management Act 1979 (extension of drawback to shipment, and warehousing for use, as stores) shall cease to have effect.

• (4) Subsection (3) above shall come into force on such day as the Commissioners of Customs and Excise may by order made by statutory instrument appoint.

Part II — Value added tax

Exclusion of charge in case of individual pension accounts

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• (1) In subsection (4) of section 21 of the Value Added Tax Act 1994 (which treats as reduced for VAT purposes the value of goods falling within subsection (5) of that section and imported from outside the EU)—

• (a) at the beginning there shall be inserted “ Subject to subsection (6D) below, ”; and

• (b) for “14.29 per cent.” there shall be substituted “ 28.58 per cent. ”

• (2) For subsections (5) and (6) of that section there shall be substituted the following subsections—

(5) The goods that fall within this subsection are— (a) any work of art; (b) any antique, not falling within paragraph (a) above or (c) below, that is more than one hundred years old; (c) any collection or collector’s piece that is of zoological, botanical, mineralogical, anatomical, historical, archaeological, palaeontological, ethnographic, numismatic or philatelic interest. (6) In this section “work of art” means, subject to subsections (6A) and (6B) below— (a) any mounted or unmounted painting, drawing, collage, decorative plaque or similar picture that was executed by hand; (b) any original engraving, lithograph or other print which— (i) was produced from one or more plates executed by hand by an individual who executed them without using any mechanical or photomechanical process; and (ii) either is the only one produced from the plate or plates or is comprised in a limited edition; (c) any original sculpture or statuary, in any material; (d) any sculpture cast which— (i) was produced by or under the supervision of the individual who made the mould or became entitled to it by succession on the death of that individual; and (ii) either is the only cast produced from the mould or is comprised in a limited edition; (e) any tapestry or other hanging which— (i) was made by hand from an original design; and (ii) either is the only one made from the design or is comprised in a limited edition; (f) any ceramic executed by an individual and signed by him; (g) any enamel on copper which— (i) was executed by hand; (ii) is signed either by the person who executed it or by someone on behalf of the studio where it was executed; (iii) either is the only one made from the design in question or is comprised in a limited edition; and (iv) is not comprised in an article of jewellery or an article of a kind produced by goldsmiths or silversmiths; (h) any mounted or unmounted photograph which— (i) was printed by or under the supervision of the photographer; (ii) is signed by him; and (iii) either is the only print made from the exposure in question or is comprised in a limited edition; (6A) The following do not fall within subsection (5) above by virtue of subsection (6)(a) above, that is to say— (a) any technical drawing, map or plan; (b) any picture comprised in a manufactured article that has been hand-decorated; or (c) anything in the nature of scenery, including a backcloth. (6B) An item comprised in a limited edition shall be taken to be so comprised for the purposes of subsection (6)(d) to (h) above only if— (a) in the case of sculpture casts— (i) the edition is limited so that the number produced from the same mould does not exceed eight; or (ii) the edition comprises a limited edition of nine or more casts made before 1st January 1989 which the Commissioners have directed should be treated, in the exceptional circumstances of the case, as a limited edition for the purposes of subsection (6)(d) above; (b) in the case of tapestries and hangings, the edition is limited so that the number produced from the same design does not exceed eight; (c) in the case of enamels on copper— (i) the edition is limited so that the number produced from the same design does not exceed eight; and (ii) each of the enamels in the edition is numbered and is signed as mentioned in subsection (6)(g)(ii) above; (d) in the case of photographs— (i) the edition is limited so that the number produced from the same exposure does not exceed thirty; and (ii) each of the prints in the edition is numbered and is signed as mentioned in subsection (6)(h)(ii) above. (6C) For the purposes of this section a collector’s piece is of philatelic interest if— (a) it is a postage or revenue stamp, a postmark, a first-day cover or an item of pre-stamped stationery; and (b) it is franked or (if unfranked) it is not legal tender and is not intended for use as such. (6D) Subsection (4) above does not apply in the case of any goods imported from outside the member States if— (a) the whole of the VAT chargeable on their importation falls to be relieved by virtue of an order under section 37(1); or (b) they were exported from the United Kingdom during the period of twelve months ending with the date of their importation.

• (3) This section has effect in relation to goods imported at any time on or after the day on which this Act is passed.

Gold

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• (1) Notwithstanding the words preceding paragraph (a) in section 26(3) of the Value Added Tax Act 1994 (input tax allowable against output tax), regulations which—

• (a) are made under section 26(3), and

• (b) have effect in respect of exempt supplies which relate to gold,

may provide that input tax is allowable, as being attributable to the supplies, only in relation to specified matters.

• (2) An order under section 31(2) of that Act (exempt supplies and acquisitions) which provides for certain supplies which relate to gold to be exempt supplies may—

• (a) provide that a supply which would be an exempt supply by virtue of the order shall, if the supplier so chooses, be a taxable supply;

• (b) make provision by reference to notices to be published by the Commissioners.

• (3) An order under section 37(1) of that Act (relief on importation of goods) which gives relief from VAT on certain importations of gold may make provision by reference to notices to be published by the Commissioners.

• (4) Provision made by virtue of subsection (2) or (3) above may be expressed—

• (a) to apply only in specified circumstances;

• (b) to apply subject to compliance with specified conditions (which may include conditions relating to general or specific approval of the Commissioners).

• (5) Regulations may—

• (a) require specified persons to keep specified records in relation to specified transactions concerning gold;

• (b) require specified persons to give specified information to the Commissioners about specified transactions concerning gold;

• (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (6) The provisions of that Act (including, in particular, section 97 and paragraph 6(2) to (4) of Schedule 11) shall apply in relation to regulations under subsection (5) above , and to records kept in pursuance of such regulations, as they apply in relation to regulations under paragraph 6(1) of Schedule 11 to that Act and to records kept in pursuance of that paragraph .

• (7) In this section “the Commissioners” means the Commissioners of Customs and Excise.

Preparations etc. of meat, yeast or egg

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Schedule 8 to the Value Added Tax Act 1994 (zero-rating) shall have effect, and be deemed always to have had effect, as if in Group 1 (food), in Note (6) (which provides that certain items which override the exceptions listed in that Group relate only to item 4 of the excepted items (non-alcoholic beverages)) for “Items 4 to 6” there were substituted “ Items 4 to 7 ”.

Assignment of debts

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• (1) In section 36 of the Value Added Tax Act 1994 (bad debts), for subsection (3) there shall be substituted—

(3) In subsection (2) above “the outstanding amount” means— (a) if at the time of the claim no part of the consideration written off in the claimant’s accounts as a bad debt has been received, an amount equal to the amount of the consideration so written off; (b) if at that time any part of the consideration so written off has been received, an amount by which that part is exceeded by the amount of the consideration written off; and in this subsection “received” means received either by the claimant or by a person to whom has been assigned a right to receive the whole or any part of the consideration written off.

• (2) In subsection (5)(e) of that section, for the words from “where” to the end of the paragraph there shall be substituted “ where any part (or further part) of the consideration written off in the claimant’s accounts as a bad debt is subsequently received either by the claimant or, except in such circumstances as may be prescribed, by a person to whom has been assigned a right to receive the whole or any part of that consideration; ”.

• (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (4) Until such day as the Commissioners may specify in regulations made under section 36 of that Act, Part XIX of the Value Added Tax Regulations 1995 (bad debt relief), except regulation 171, shall be read as if a reference to a payment being received by the claimant were a reference to a payment being received either by the claimant or by a person to whom a right to receive it has been assigned.

• (5) Subsections (1) and (4) above have effect for the purposes of the making of any refund or repayment after 9th March 1999, but do not have effect in relation to anything received on or before that day.

Groups of companies

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Schedule 2 to this Act (which makes changes to provisions about the treatment of bodies corporate as members of a group) shall have effect.

Penalties for incorrect certificates

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• (1) For subsections (1) and (2) of section 62 of the Value Added Tax Act 1994 (incorrect certificates as to zero-rating etc.) there shall be substituted the following subsections—