SNP call for VAT parity between Scottish and NI police forces

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by a Newsnet reporter

SNP MSP John Finnie is calling on the UK Government for the new Police Service of Scotland to be given parity with its Northern Irish counterpart in not paying VAT.

The potential VAT liability of the new single Scottish police force and single fire and rescue organisation is estimated to be £22m annually for the police and £4m for fire and rescue services.

At present, police forces and fire services are able, under section 33 of the Value Added Tax Act 1994, to recover any VAT costs incurred. A move to single Police and Fire services in Scotland may result in the new bodies losing their section 33 exemptions status.  However the single Police Service of Northern Ireland enjoys full VAT exemption.

Mr Finnie says it would be a “naked cash grab” from Westminster and “utter hypocrisy” for the Police Service of Northern Ireland to be exempt while Scotland is lumped with a huge bill.

The SNP MSP for Highlands and Islands and a former police officer himself, has written to Justice Secretary Kenny MacAskill urging him to make representations to have Scotland needs to be treated equally with Northern Ireland.

He said:

“It is utterly hypocritical of the UK Government to demand the new Police Service of Scotland pay VAT while the PSNI does not.

“This would just be a naked cash grab from Westminster. The case for parity between the two forces is unanswerable.

“Only this week figures have shown Scottish police forces are estimated to have paid well over £1.2million in VAT on fuel costs to the Treasury in 2011.

“This is a significant amount of money – especially at a time when record fuel prices are damaging our emergency services.

“These same figures showed the amount of duty paid on fuel by police forces and fire brigades in Scotland has been hiked by 53 per cent and 69 per cent respectively between 2003 and 2009.

“While emergency services budgets are under pressure, we must do everything in our power to help support them, which is why I’m calling on Westminster to treat Scotland in the same way as Northern Ireland.

“I have written to the Justice Secretary urging him to make representations to the UK Government on this matter.

“For the new PSS, paying VAT would result in the loss of considerable sums that should instead be invested in making the new service the best it can be.”