John Healey, the Government Treasury Minister responsible for Customs and
Excise and VAT, has written to Michael Fabricant telling him he has
"instructed" Customs officials to meet with representatives of the National
Arboretum near Alrewas in Lichfield to discuss the imposition of 17.5% VAT
on memorials to Britain’s war dead and seek "an outcome which is acceptable
to all parties, both in terms of the Arboretum’s activities in the past and
its activities in the future". Michael Fabricant says "We are not through
the woods yet, but this is encouraging. Customs and Excise have claimed
that The National Arboretum owes a huge amount of money on trees already
planted as well as on its future activities. This is jeopardising the
future of the whole project. I am reassured that the Minister recognises
that a solution must be found to both past and present VAT liabilities".

The purchase of trees and other memorials to commemorate those who fell for
their country are now being regarded as a "taxable supply" for VAT purposes.
Michael took this up with Government Ministers last month. Michael said at
the time of contacting the Treasury: "I have read the correspondence from
the Customs and Excise and it is almost obscene in ignoring the
sensibilities of loved ones. To whom is the tree being ‘supplied’?
Certainly not the serviceman killed in service for his or her country. On
the one hand, the Ministry of Defence supports the work of the National
Memorial Arboretum; on the other hand, the Government is taxing those who
contribute."

In his letter to Michael Fabricant, John Healey continues: "It was useful
to have our conversation in the Commons as well as receive your
correspondence……….. I have asked for a report from Customs officials
following discussions with the National Memorial Arboretum and I will bring
you up to date after this."

"I now await the report from the Minister and from the National Arboretum.
I hope this matter can now finally be resolved." adds Michael Fabricant.

Further details can be found in the News Release dated 1st July 2002.