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MAIL ORDER FIRM LOSES VAT ON POSTAGE APPEAL

News, 01 January 1999

THE HIGH COURT of Justice has overturned the practice of many decades when it upheld HM Customs and Excise’s appeal against mail order plants and bulbs specialist Plantiflor. The appeal overturned last year’s decision by a VAT & Duties Tribunal which ruled in the firm’s favour. Plantiflor had treated postage as a disbursement and not, therefore, subject to VAT; Customs and Excise took an opposing view. The case has far reaching ramifications both for the mail order and mailing house industries, which hitherto have been allowed to treat postage as a non-VAT disbursement. Managing director Martin Harvey is mulling whether to take the case to the Court of Appeal: ‘We believe UK Customs legislation is contrary to European law under the Treaty of Rome’s VAT di-rective’, he said.