international trade 41
Southeast Asia mission targeting projects for British business
In June, trade and investment minister Lord Green took a two week trip to Southeast Asia to promote high-value opportunities for British businesses in the region.
During his trip Lord Green visited Jakarta, Kuala Lumpur, Singapore, Phnom Penh, Ho Chi Minh City, Hanoi, Bangkok, Rangoon and Naypyidaw. The minister met leaders and business figures including Cambodian prime minister, Hun Sen, Vietnamese prime minister Nguyen Tan Dung and Burmese opposition leader Aung San Suu Kyi.
The visit formed part of a wider effort to enhance the support available to British companies overseas, to start trading in the region or to sustain and build on their existing activity. The intent was to help enhance the British Chamber of Commerce in five of these countries to enable them to provide high-quality support services that can significantly add to those already provided through UK Trade & Investment (UKTI).
Lord Green said:“With so many high growth and emerging markets, Southeast Asia presents an enormous opportunity for UK goods and services. Through our global network, UKTI is able to give UK businesses intensive support to access high-value opportunities, from large scale projects worth billions of pounds through to substantial supply chain opportunities.
“We are significantly enhancing the support available for British business here in Southeast Asia. We have signed agreements with the British Chamber of Commerce in Singapore with signings planned for Malaysia, Indonesia and Thailand that will see them providing a wider range of the services British companies need to do business here.
“This work by the Chambers will help UKTI focus on high-value opportunities and major trade- related campaigns as well as attracting high-quality inward investment to the UK, helping high
value South East Asian businesses and institutions that recognise the UK as a great place to invest.”
Highlights of Lord Green’s visit included:
• Attending the launch of the TM Lewin brand in Jakarta
• Making the opening speech at the Subsea Asia Conference in Kuala Lumpur
• Launching the Enhancing Trade Initiative in Malaysia
• Opening the UK Innovation Forum in Singapore
• Visiting the award winning Vattanac Tower site –eight British companies have contributed to its design and construction
• Visiting the My Dinh National Stadium in Hanoi to discuss opportunities for British companies at the Asian Games 2019
• Opening a major infrastructure seminar in Bangkok showcasing UK expertise in large-scale projects
• Officially launching a British Business Group in Burma.
Key Facts:
• As a region, South East Asia’s economy is predicted to grow by 5-5.5% in 2013 – lower than China or India, but higher than other key emerging markets and the global average
• In recent years the ASEAN region has attracted a great deal of high level interest in support of UK companies exporting to the area and setting up business there
• The UK is now present in all 10 ASEAN countries. UKTI has offices in nine of them
• UK exports of goods only to ASEAN in 2012 were £8.9 billion. An increase of 15% on 2011. UK imports of goods from ASEAN in 2012 were £12.62b. An increase of 5%
• The UK’s top 3 goods exports to ASEAN are: engines, motorcars and whisky. UK imports from ASEAN region include: organic chemicals, clothing and engines. 86% of our exports go to Singapore, Thailand, and Malaysia
• Exports to Singapore increased by 16% in 2012 UK goods exports to Thailand increased 38% in 2012.
VAT and Customs rules in the EU
On 1 July 2013 Croatia becomes the 28th EU member state, with supplies to or from there being subject to the EU VAT system, and in the following we highlight some of the EU VAT rules appli- cable to trading within the EU.
Goods
The movement of goods into and out of EU member states is not subject to Customs Duties.
Instead, sales to EU business custom- ers are covered by the VAT acquisition tax rules, with suppliers zero rating the sales and reporting the values on VAT returns and EC Sales lists. EU businesses buying goods from EU suppliers have to record the purchases on their VAT returns and, where appropriate, account for local acquisition VAT through their VAT accounts.
Depending on the values involved, the EU buyers and sellers may also have to include the transaction details on
Supplementary Intrastat Declarations. However, EU based internet/mail order companies selling goods to EU based consumers, including Croatia or any other EU member state, may have a liability to register in the consumers EU member state.
Services
Supplies of certain services are subject to the EU place of supply of services rules.
Non-EU based suppliers to consumers of electronically supplied services (i.e. internet downloads) and telecommunication services may have to register in one member state and pay EU VAT through the special one stop shop scheme.
For EU based suppliers of services, most supplies to business customers will be subject to the ‘Reverse Charge’ rules where the customer pays local VAT on the service. Suppliers to business customers will have to record the sales on EC Sales lists for services. EU based buyers will have to account
for local VAT on services bought in from EU suppliers.
EU suppliers of electronically supplied/ telecommunication services to consumers will account for VAT where they are established.
However, If the supplies fall within one of the exceptions, such as land related, passenger transport, the hire of a means of transport, organisers of events for consumers and sellers of admission to cultural, sporting, educational and scientific events etc, the supplier may now have to register and account for VAT in the EU member state where the service is seen as taking place.
Obtain advice
These are just some of the issues arising from the EU VAT rules and they are not exhaustive. Therefore, all businesses that conduct trade in, or to, or from the EU, should seek specialist advice on the new VAT/ Customs accounting requirements applicable from 1 July 2013.
Contact us
For further information on this or any other VAT issue, please contact: Damon Wright
Director of VAT Services E:
damon.wright@mhllp.co.uk T: 0118 950 3895 or 07720 590782
For further information on wider cross border taxation issues, please contact: Chris Denning Tax Partner
E:
chris.denning@
mhllp.co.uk T: 0118 950 3895 or 07900 808759
MHA MacIntyre Hudson Pennant House 1-2 Napier Court Napier Road Reading RG1 8BW
T: 0118 950 3895 E:
reading@mhllp.co.uk
www.macintyrehudson.co.uk
THE BUSINESS MAGAZINE – THAMES VALLEY – JULY/AUGUST 2013
www.businessmag.co.uk
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