As much as I would like to see reductions, I still think these are impossible to argue for.
Britain isn't a cycling country, it's very much a minority and leisure interest here. By contrast, in The Netherlands, Denmark and Germany, cycling is very widespread and much more for utility purposes rather than just leisure.
But there the population not only buy much dearer e-bikes on the whole, they buy them with substantial VAT rates, 19% in The Netherlands and Germany, 25% in Denmark. Since we are trading partners with the EU and are subject to EU VAT rules, our case for reductions is very weak. Add to that the privileged import duty position on e-bikes that we enjoy, as Dave of Kudos has observed above, and the case becomes hopeless.
There are back-door reductions possible though. Although opposed by a number of countries including Germany surprisingly, there is a 6% VAT rate that can be sneaked onto some more minor things. For example, in The Netherlands the VAT rate on bicycle repairs is only 6% instead of their standard 19%.
I have a great deal of respect for you Tony, but have to say this discussion, for me, isn't about whether VAT can practically or legally be reduced or removed from bikes, but whether it
should be.
This year I have noticed increasing trends in bike purchase to provide practical transport, often as replacement for combustion commuting. I hear customers, increasingly younger customers, argue their need is for cheap transport "to get to work" and to "help make ends meet".
This trend rapidly became apparent to me as, initially VAT rose in January, and then as fuel prices increased during the early part of this year. Previously purchase of our bikes tended to be for mainly leisure and health reasons.
It's pleasing in some respects that the choice is between combustion and electric as I am very keen to help reduce combustion use. It suits my environmental principals and is a reason why I don't choose, for instance, to sell fags and booze.
But I also feel a strong concern for those in our community that are struggling to get to work, in increasingly diminishing employment conditions. Especially the young, who were promised, before the credit crunch happened, a reasonably wide choice of decent careers in which to invest their hope and provide motivation.
As the cuts really start to bite I am becoming more and more concerned that transport costs are becoming critical in the budgets of the low paid. My own daughter in London, who studied hard and achieved a great Honours Degree in a difficult academic subject from St Martins, is now travelling across London to work as a retail assistant in the West End.
For her, affording accommodation, repaying her education loan, eating and maintaining friendships, having a sense of purpose and value within society would be impossible without her bike. Walking is not practical and public transport, even in London with its comprehensive and reliable infrastructure, is prohibitively expensive.
Until recently I have been out of touch with the reality that the poorest in our society have to spend, in order to adequately survive, and be properly part of society. I admit to feeling more than a little guilty when I reflect on the opportunities I have had, in education and employment, compared to what exist for younger people today.
I believe it's time to question whether a bicycle is a luxury item or an essential aide for those without much choice to fully participate in a society which is increasingly becoming polarised between the fortunate and able, and those, through no fault of their own, suffering the consequences of what has happened during the last 30 or more years.
I have long subscribed not to "survival of the fittest" doctrine, but "protection for the weakest" and I think that honourable value can be reflected in how we choose to tax. It's a value that the UK should offer to the rest of Europe.
Please excuse this rant!
Bob
