Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what plans he has to bring forward legislative proposals in 2020 to implement the recommendations of the Office of Tax Simplification on reforming the turnover threshold for Value Added Tax registration by businesses; and if he will make a statement.

The case for change of the VAT registration threshold has been regularly reviewed over the years, and public views are divided. Whilst some argue that a lower threshold would provide a fairer competitive environment, others contend that a higher threshold would reduce financial and administrative burdens.

In 2018, the Government consulted on how the design of the VAT registration threshold could better incentivise growth and considered the effects of a smoothing mechanism, however there was no clear option for reform. The summary of responses to the call for evidence can be found here: https://www.gov.uk/government/consultations/vat-registration-threshold-call-for-evidence.

At Budget 2018, the Government announced it would maintain the VAT registration threshold at £85,000 until March 2022.