Richard Drax, MP for South Dorset, has asked HMRC to consider exempting Air Ambulances from VAT on fuel.
In a Commons debate brought by MPs Guy Opperman, member for Hexham and Hugh Bayley, member for York Central, Drax said that he hoped “common sense” would prevail.
Whether or not an air ambulance paid VAT on fuel depended upon who owned and operated them, he said. Those owned by charities were VAT registered and therefore paid VAT, he said, while those operated by a third party were billed for the total service and exempted from fuel VAT under an agreement made with HMRC in 2005.
Calling for an exemption from VAT, to be harmonised across all air ambulances, Drax said that overall, they
“must pay £100,000 every year in VAT. That rises with every increase in the price of fuel. That sum would pay for about 30 mercy flights…this is not really about money; this is about saving people’s lives.”
Pointing out that VAT on fuel was an EU initiative, Drax said, “Only the RNLI has been allowed exemption from duty charges on marine diesel due to its life-saving role-no different, in effect, from that of the air ambulances. With such a precedent already set, it seems an obvious and relatively inexpensive step for HMRC to extend this exemption to helicopter emergency air services.”