- The Terminal Markets Order (TMO) provides for the VAT zero-rating of certain wholesale commodity transactions made by members of certain commodity exchanges.
- In July 2023, HM Treasury consulted on modernising the legislation setting out the VAT treatment of transactions within the scope of the TMO.
- The amendments are intended to reflect how the markets now operate and provide greater certainty, without amending the policy or scope of the TMO.
- The consultation also included proposals to include the UK Emissions Trading Scheme in the scope of the TMO.
- Finance (No.2) Act 2024 included legislation to enable the amendment of the TMO (by way of statutory instrument), including bringing trade in carbon credits within the scope of the TMO.
- Timing: the reform was introduced by the previous government. It is uncertain how the current government intends to take this forward so the timing of the above amendments to the TMO is unclear.
Resources (click to open)
- Terminal Markets Order (Deloitte TaxScape, March 2024)
- Legislative reform of the Terminal Markets Order: Consultation (HM Treasury, consultation, July 2023)
