Simplifying the VAT land exemption: Summary of responses

Most responses were in favour of some simplification to existing rules, although a number felt the current rules are understood and work well.
The majority of responses urged caution over sweeping changes to the current rules: targeted simplification in specific areas was preferred.
Current difficulties identified included the Option to tax anti-avoidance rules, mixed-use developments and short term arrangements such as conference facilities where is unclear if the supply should be treated as a property letting or as the provision of facilities.
Suggestions previously Made and discounted by the OTS were rejected by a majority of respondents. These suggestions included removing the option to tax or making all commercial land and property taxable with an option to exempt.
Most respondents disliked the idea of linking the VAT liability of interests in land to those recorded in land registers.

Suggestions given by respondents for simplifying the existing rules included:

Reforming the option to tax anti-avoidance legislation.
Maintaining a real-time accessible public record of land and property which has been opted.
Shortening the option to tax revocation period to 10 years.