The boss of a staffing agency is urging the Government to change VAT rules to punish companies that pay their bills late.
Beatrice Bartlay, managing director of 2B Interface, wants the Government to force all businesses to pay the VAT on all invoices for goods and services received which, by the date of the VAT return have been unpaid for more than 60 days.
She says the payment would apply irrespective of whether the original invoice was zero rated or not and would not be recoverable when the invoice is paid.
“This would have the effect of making any goods or services supplied where the invoice is unpaid after 60 days 20 per cent more expensive than similar goods and services paid for within 60 days,” says Mr Bartlay.
“HMRC needs to consider this simple rule change which in one fell swoop would release cash throughout the supply chain and give Britain’s SMEs a chance to thrive and prosper,” she adds.