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The draft legislation and explanatory note clarify how VAT and excise law should be interpreted after changes made by the Retained EU Law (Revocation and Reform) Act 2023.
The government has published draft legislation in relation to retained EU law for VAT and excise ahead of potential inclusion in the next finance bill. The legislation clarifies how VAT and excise legislation should be interpreted following changes made by the Retained EU Law (Revocation and Reform) Act 2023 (REUL Act). An explanatory note has also been published.
The REUL Act ended the supremacy and special status afforded to retained EU law in the UK. In relation to VAT and excise, the draft legislation is intended to confirm that it will no longer be possible for any part of any UK Act of Parliament or subordinate legislation to be disapplied on the basis that it is incompatible with EU law.
The draft legislation should also ensure that the rule known as ‘the principle of consistent interpretation’ continues to apply. This means that UK VAT and excise legislation will continue to be interpreted as parliament intended.
The government is seeking views on whether the draft legislation achieves its intended effect, as set out above. Any responses or queries regarding this should be sent by email to retainedeulaw.financebill@hmrc.gov.uk by 17 November 2023.
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