The tax on personal protective equipment purchased by care homes, businesses, charities and individuals will be cut from today, it has been announced.
According to HM Treasury, PPE, such as face masks and gowns, will be zero-rated for VAT from 01 May to 31 July 2020.
The move is expected to save businesses and not-for-profit organisations approximately £100 million over the three-month period.
HM Treasury added that the removal of VAT will particularly help care providers, who are often unable to claw back what they paid.
The Government said it was only able to waive VAT on PPE by acting under an “exceptional basis allowed by EU rules during health emergencies”.
It comes after the Government recently waived import duties on specific medical supplies coming from outside the European single market for use by the NHS. The full list of commodities can be found here.
Commenting on the removal of import duties, the Chancellor Rishi Sunak said waiving fees will “speed up” the supply of critical items going to essential workers, adding that the changes will also make the UK “more attractive to companies who want to produce or donate supplies to fight coronavirus.”
For advice understanding how these changes affect your organisation, please get in touch with our expert team today.