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barrabus

Vat On Gold

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Has anyone else heard the rummer that the Gov are about to reintroduce VAT on gold, conversation over heard in Chard Blackpool

Probably.

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I hope not. However, it is the policy of spite and of people who wish to steal other peoples' hard-earned gains, and it is the policy of thieving governments who are utterly desperate for yet more money to throw down the toilet of government spending; so maybe I am wrong.

There are two reasons it may not happen.

1. There is little money to be gained by taxing gold sales, which are relatively easy to conceal, compared with taxing salaries, which are relatively difficult to hide. France and Germany will be among the very last to allow VAT to be imposed on gold investments. Day trips to France are cheap.

2. The "Elites" of all countries, really would rather not have their personal investments tampered with, particularly by a thick oaf who is manifestly incapable of running an economy, so the EU (home of the biggest snout-troughers in the known Universe) may have a quiet word.

Having acknowledged that the EU may have some small use, I will temporarily retire to the bathroom to wash out my mouth with soap.

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1. There is little money to be gained by taxing gold sales, which are relatively easy to conceal, compared with taxing salaries, which are relatively difficult to hide. France and Germany will be among the very last to allow VAT to be imposed on gold investments. Day trips to France are cheap.

There is an EU wide plan to change VAT rules/law.

The idea is that things subject to carousel fraud do not have B2B VAT levied. VAT will only be paid when the end customer pays. That includes mobile phones, platinum bullion, and computer chips. (i.e. no VAT refunds)

Slipping Gold into that basket is very easy, and would apply across the EU.

Try buying a platinum bar without VAT (and getting it in your hand).

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<!--quoteo(post=2170348:date=Sep 29 2009, 07:46 PM:name=Old Nis)--><div class='quotetop'>QUOTE (Old Nis @ Sep 29 2009, 07:46 PM) <a href="index.php?act=findpost&pid=2170348"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->1. There is little money to be gained by taxing gold sales, which are relatively easy to conceal, compared with taxing salaries, which are relatively difficult to hide. France and Germany will be among the very last to allow VAT to be imposed on gold investments. Day trips to France are cheap.<!--QuoteEnd--></div><!--QuoteEEnd-->

There is an EU wide plan to change VAT rules/law.

The idea is that things subject to carousel fraud do not have B2B VAT levied. VAT will only be paid when the end customer pays. That includes mobile phones, platinum bullion, and computer chips. (i.e. no VAT refunds)

Slipping Gold into that basket is very easy, and would apply across the EU.

Try buying a platinum bar without VAT (and getting it in your hand).

I take your point that if they do decide to add VAT to gold purchases, then it is extremely difficult to avoid the VAT, and that adding VAT to the cost would merely require the stroke of a pen, but:

1) One has to ask why the PTB removed it in the first place. I have no proof whatsoever for this conjecture, but merely ask others of our esteemed forum to add their thoughts. My personal view is that gold is the primary money and investment metal. (I do not like this, as I am primarily a Silverbug, but what I would like to be true does not alter the facts of the matter). Bearing in mind that the Germans and French, in particular, have had times when their countrymen had to flee for their lives taking their wealth with them, or have had horrendous inflation affect their economies, then it would make sense for the wealthy/elite/illuminati (select your level of paranoia) to pressure their governments to allow them to buy and sell investment gold without VAT so as to allow their wealth to accumulate faster. I do not believe that politicians would ever exempt items from tax without a very good reason or extreme pressure from powerful individuals.

2) The VAT frauds you so rightly draw attention to, were items that are mass-market goods that are very easy to sell on, and therefore invited fraud. The immediate response might be that gold is easy to sell on too, but on what scale? The circles that the fraudsters move in, make it easy and inviting to indulge in smuggling and VAT fraud shifting chips and mobiles because it can be done on a scale that makes the risk worthwhile. Gold is not like that. It is a tiny market for a few people, who probably have much more of a reputation/job/position to lose than the sellers of dodgy mobile phones. Ditto for tobacco.

3) Carousel fraud loses the HMRC millions, but this is only true because of the scale of the sales and the fact that the end-users pay VAT. To impose VAT on investment gold would make carousel fraud more lucrative for a criminal, although unlikely. Even the most successful jeweller would not have enough of an "underground" market to risk his/her business this way.

I accept that Gordon the Ruiner (or the EU for that matter) has never allowed common sense to intrude on decision-making processes, but this is one where he would attract the wrath of people who are powerful enough to cause him trouble, for a trifling return.

Anyone in power who feels tempted to do monetary things which may annoy the PTB should take their heads for a slap and remind themselves what was found under Blackfriars' Bridge not so long ago.

Nevertheless, others may point out flaws in this argument.

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Carousel fraud doesn't rely on a sale, you transport goods round europe (or pretend to) and claim VAT refunds back on each border crossing.

Yes, sorry, I made my point very poorly. What I am getting at (and still may have missed your point) is that VAT is involved, supposedly to be charged to the final end-user. If no VAT is involved, as is the case with gold presently, then it's a bit difficult to claim VAT back.

However, I could now argue against myself and say that gold is more likely to be transported in a secure, and therefore more trackable manner. Unless you put it in the boot of the family hatchback, of course.

It could also be the case that the elites have already filled their boots, and no longer care.

I fail to see how this nonsense would benefit the exchequer. It seems to be too small a market to be worth it, unless the government is truly scraping the bottom of the barrel and is so desperate for revenue that there is no level to which they would not stoop. Errr, oh...

Edited by Old Nis

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I fail to see how this nonsense would benefit the exchequer. It seems to be too small a market to be worth it, unless the government is truly scraping the bottom of the barrel and is so desperate for revenue that there is no level to which they would not stoop. Errr, oh...

http://www.hmrc.gov.uk/manuals/vgoldmanual/VGOLD1700.htm

"Allows Member States to introduce measures to combat fraud on gold supplies between taxable persons"

That implies that VAT was dropped, because VAT fraud was occuring. Now, if the EU have come up with a general way to stop VAT fraud occuring, then I see no reason why VAT will not be bought back.

Taxing jaffa cakes is fairly low IMO

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