Define: Zero-Rated Goods And Services

Goods and services that are taxable for value added tax (VAT) purposes but are currently subject to a tax rate of zero.

Zero-rated goods and services are goods and services that are taxable for value-added tax purposes but are currently subject to a tax rate of zero.

These differ from exempt status in that the VAT attributable is allowable for input tax credit.

Examples of Zero-rated supplies include:

• Most food items
• Sewerage and water services for non-industrial users
• Books and periodicals
• Certain Charitable Supplies
• New Domestic Buildings
• Transport fares for vehicles intended to carry not less than 10 passengers
• Banknotes
• Medicines
• Children’s footwear and clothing
• Fuel for Lifeboats and Air Ambulances
• All exports.

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Definitions for Zero-Rated Goods And Services are sourced/syndicated and enhanced from:

• A Dictionary of Economics (Oxford Quick Reference)
• BusinessDictionary.com
• Oxford Dictionary Of Accounting
• Oxford Dictionary Of Business & Management

This glossary post was last updated: 27th January 2019.