The rate of tax may be changed either by statute or by Treasury Order. Different considerations apply to each.
Statute—changing the rate of VAT in the UK
The Provisional Collection of Taxes Act 1968 applies to VAT1. Briefly, this means that the rates at which tax is charged may be varied by a resolution of the House of Commons2, and such resolution has effect for a period of seven months3 provided that, within 30 sitting days following the passing of the resolution4 either:
- Ìý
•ÌýÌýÌýÌý a Bill for that purpose receives a second reading within 30 days
- Ìý
•ÌýÌýÌýÌý a Bill is amended so as to include provision for the renewal, variation or abolition of the tax
A resolution ceases to have effect when its provisions are rejected during the passage of the Bill, or where Parliament is dissolved or prorogued (ie the parliamentary session comes to an end). However, with effect from 30 December 2011, it
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