The Fair Playing Field report by Monitor – published in March 2013 – recommended that the Government report on the case for extending VAT refunds to some charitable NHS-funded healthcare providers by Budget 2014, such as hospices.
This issue will not now be considered until a wider review of the headings in the central Government VAT refunds scheme has been completed, which is expected to report back by this year’s Autumn Statement.
Responding to last week’s Budget, which includes measures to reimburse air ambulance charities for VAT on fuel, Craig Duncan, Finance Director at national hospice care charity Help the Hospices, said:
“We are encouraged by the Government’s commitment in the Budget to cover VAT costs for air ambulance charities.
“We have long been working with the Government to address similar issues for hospices which provide the majority of hospice care in the UK, but unlike NHS providers, are unable to reclaim VAT on non-business supplies. This creates a considerable financial burden for hospices and diverts much-needed funds from patient care. Many hospices are already struggling to raise funds in a tough economic climate and demand for their services is rising, driven by the UK’s rapidly ageing population.
“We hope the Government will take action soon to close the VAT gap faced by hospices to ensure their funds are used fully for the benefit of patients and to address discrepancies across the healthcare sector on this issue.”