Question to the HM Treasury:

To ask His Majesty's Government what consideration they have given to extending an exemption of VAT to (1) all, or (2) some, publicly funded vehicle categories; and whether they have any plans to review the current position.

Public sector bodies pay VAT in the same way that businesses and consumers do. As their activities are 'non-business', they are not ordinarily able to reclaim VAT incurred.

However, specific provisions in the VAT Act mean that most public bodies can already claim refunds for some or all of the VAT they incur in meeting their statutory responsibilities.

The government continues to keep all taxes under review.