VAT 'admission' could save ski resorts £1m bill

SCOTTISH ski centres paid more than £1 million to the Treasury last year because of VAT charged on ski lifts classed as private transport.

Campaigners fighting the levy said it puts Scottish resorts at a disadvantage when competing against other ski centres in Europe and raises the cost of the sport artificially high.

They now hope that an admission from an MP could cut the recently-increased 20 per cent rate (up from 17.5 per cent) to just 5 per cent.

This would mean the five Scottish ski centres saving about 800,000 a year which could be put back into the industry and stimulate tourism while reducing costs to skiers. Presently an adult day pass at Cairngorm costs 30.80, at Glenshee 27 and at Nevis Range 29.

Although the industry is currently enjoying a rare boom period after two seasons of heavy and prolonged snowfall, it is still in a precarious financial position. But, uniquely in Europe, Britain classes individual seats on ski lifts as separate vehicles for VAT purposes, meaning that the majority of ski passes in Scotland are more expensive.

Highlands and Islands SNP MSP Dave Thompson took the matter up last year with Danny Alexander, the Chief Secretary to the Treasury - a former public relations boss at Cairngorm National Park Authority who is based in Aviemore- asking him to end the charging of VAT on sales of ski-lift passes.

He was previously told that an exemption for public transport applies only to vehicles capable of carrying more than ten passengers, whereas ski lifts typically carry no more than three passengers. But Alexander passed the matter to Treasury colleague Justine Greening, the Economic Secretary to the Treasury who said that, although European rules meant that Britain had no power to introduce a new area of VAT exemption, a reduction of VAT to 5 per cent was possible.

Thompson said: "Ms Greening's acknowledgement that a reduction to 5 per cent would be possible is a major breakthrough. Her letter does not reject any reduction in VAT for ski lifts."

Heather Negus, marketing manager for the Nevis Range resort, said: "If the VAT rate was reduced to 5 per cent, then we have calculated that we would be able to reduce the costs of an adult day pass at Nevis Range, currently 29, by almost 4, which we know would represent a welcome saving to our customers, especially in the current economic climate."