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The PRT group had significantly reduced VAT compared with the sham group (Table 1); also, reductions in VAT within the PRT group predicted reductions in FM (r = 0.69), although this relationship was not significant in the sham group (Supplementary Fig. 2 A and B ).
His original plans, announced in 2000, reduced VAT from 17.5% to 5%, and yesterday Mr Brown extended the scheme to wipe out VAT altogether until March 2006.
Labour reduced VAT on sanitary products from 17.5%to5%5% in 2000 but could not go any further under EU rules.
European law prohibits the 27 E.U. member states from applying reduced VAT rates on e-books, which are, in legal terms, considered a service.
The money is to be divided between direct incentives for businesses and homes, help for energy companies to install "smart" meters, funding the Energy Savings Trust, and reduced VAT for energy savings materials.
Hall points to other European countries: as part of its recovery plan Ireland reduced VAT on hotel accommodation and food to 9% earlier this month while France is seen to have benefitted form the decision, taken two years ago, to reduce it to 5.5% on restaurant meals.
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One aims to facilitate trade for SMEs within the single market and reduce VAT fraud, while the other deals with setting up a clearer system of VAT rates.
Another problem that Peters faced was rumours that the government was going to reduce VAT.
The pair also put forward policy ideas, with Smith flirting with the idea of reducing VAT by 5p.
As the world's champion exporter and with an industrial and manufacturing sector bigger than Britain and France's combined, Germany sees less utility in cutting taxes or reducing VAT.
This week's annual report on the UK urged the chancellor to reduce VAT and increase public spending rather than relying on the private sector for growth.
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