The Government’s temporary VAT relief on personal protective equipment (PPE) will not be extended, it has been confirmed.
It means that businesses and consumers of items such as face masks, gowns and gloves will now have to pay the 20 per cent sales tax from this month after not having to do so since May.
Announced at the outbreak of the virus, the Government said the measure will “relieve the burden of VAT on the price of purchasing PPE used for protection from coronavirus by frontline workers”.
While care homes and the healthcare sector can continue to purchase PPE through the Department of Health and Social Care’s dedicated portal, the change could incur additional costs and cash flow implications for businesses, which are legally required to supply protective equipment to staff.
According to the latest figures, the VAT relief has saved businesses and consumers over £300 million throughout its lifecycle.
VAT-registered firms can, however, continue to reclaim the VAT portion of the sale and claim PPE as a business expense.
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