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Learning English - Words in the News
01 November, 2006 - Published 14:30 GMT
Bournemouth Orchestra loses battle over VAT
The Bournemouth Symphony Orchestra was founded in 1893
The Bournemouth Symphony Orchestra was founded in 1893

Bournemouth Symphony Orchestra has failed in its court battle to be exempt from charging VAT on ticket sales. Listen to this report from Bournemouth:

Listen to the story

The Court of Appeal agreed with last year's High Court decision that having a paid executive on the board meant the BSO was not "essentially voluntary". This is one of the requirements imposed by the Revenue for the orchestra's admission income to be treated as VAT-exempt.

The BSO said it was "very disappointed" and would consider an appeal. In 2002, The European Court ruled that London Zoo's ticket money could be treated as free of VAT. The decision overruled the UK one and allowed many charities to reclaim VAT backdated to June 1993 - three years before the EU legislation was implemented in the UK.

But in December 2003, customs issued a policy stating that as long as one person is paid for managerial or administrative work, or has a financial interest in the company, is either an actual board member or in possession of delegated power, the exemption could not apply.

Last year, Mr Justice Mann ruled in the High Court that because managing director Michael Henson was paid for his work on the board of the BSO, it meant it was not "essentially voluntary". Simon Millward, spokesman for the BSO, told BBC News that the orchestra is very disappointed with the ruling. It was given very strong indications that it would win the appeal.

Listen to the words

a paid executive
a senior businessman or businesswoman who receives money for the work they do

on the board
among the directors of a company

short for Value-Added Tax - a tax added to the price of an article and paid by the buyer to the seller who then pays it to the government

freed from something, such as a duty, service or payment

an appeal
a strong request for the decision to be reconsidered

changed a previous decision by a superior authority

made effective from an earlier date

legislation was implemented
a set of laws became effective

administrative work
work concerning or related to the management of affairs, not to the financial and business decisions

delegated power
authority entrusted to them by someone else

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