The government will waive the expected VAT of up to £1.1m from sales of the poppies used at the First World War commemorative installation at The Tower of London
The government will donate an amount equivalent to the expected net VAT receipts from the sale of the poppies, which is £1.1m, to six charities who provide valuable support to injured Armed Services personnel and their families.
The VAT rebate will be financed using some of the Libor fines collected from the banks.
The six charities that will benefit from the announcement are:
- Cobseo – a body that works to maximise the charitable support to the Armed Forces community through co-operation, co-ordination and collaboration of organisations working in the Service Charity sector
- Combat Stress - the UK’s leading military charity specialising in the care of Veterans’ mental health, treating conditions including Post Traumatic Stress Disorder (PTSD), depression and anxiety
- Coming Home - the fundraising campaign for Haig Housing Trust, which provides specially adapted homes for seriously injured and disabled Servicemen and general needs housing for ex-Servicemen and their families.
- Help for Heroes – a leading charity that inspires, enables and supports those who have made sacrifices on our behalf to achieve their full potential
- The Royal British Legion - the nation’s largest Armed Forces charity, providing care and support to all members of the British Armed Forces past and present and their families.
- Soldiers, Sailors, Airman and Families Association (SSAFA) - provides lifelong support to anyone who is currently serving or has ever served in the Royal Navy, British Army or Royal Air Force and their families.
Announcing the decision to waive VAT on the Tower of London Poppies, the Chancellor George Osborne said: 'Each one of these poppies brought from their Derby factory to the Tower of London represents a British soldier who answered the call from their country a century ago and made the ultimate sacrifice.
'Their sacrifice reminds us of the part played throughout recent times by our Armed Forces to preserve our security and freedom, and of the debt we owe them. It is therefore right that we use the fines from those who’ve demonstrated the worst of values to support those who demonstrate the best of values everyday.
The 888,246 fundraising poppies were made by ceramic artist Paul Cummins. Stage designer Tom Piper and Historic Royal Palaces have worked together to install the poppies in the moat of the Tower of London to commemorate military fatalities during the First World War.
All net proceeds plus a guaranteed 10% from every poppy sold will be shared equally among the six service charities, continuing to support the families of the injured service personnel.
The VAT will be refunded in the form of a charitable donation.