Westmorland ran motorway service stations. Its practice, known to coach drivers, was to provide, without payment, a packet of cigarettes and a self-service meal (chosen from its usual menu) to any coach driver who brought a coach with at least twenty passengers and stopped for at least thirty minutes. The issue was to quantify the non-monetary consideration for Westmorland’s taxable supply of cigarettes, food and soft drink.
Held:The consideration was to be determined by reference to Westmorland’s normal retail prices (and not the cost to Westmorland of the goods supplied). The court summarised the effect of the Naturally Yours and Empire Stores cases: ‘The principles derived from the two cases to which I have referred are as follows. (1) Where the consideration is not money, it must be capable of being expressed in monetary terms, and there must be a direct link between the relevant supply and that which is alleged to have been the consideration for it. (2) The value of the non-monetary element must be assessed on a subjective rather than an objective basis. (3) Where the parties have expressly or implicitly attributed a value to that element in money terms that determines its value. (4) Where, however, the parties have not done this, the value can only be the price which the supplier has paid for the articles which he is supplying free of charge in return for the services in question.
Judges:
Hutchinson LJ
Citations:
Times 05-Feb-1998, [1998] STC 431
Statutes:
Jurisdiction:
England and Wales
Citing:
Appeal from – Commissioners of Customs and Excise v Westmorland Motorway Admn 21-Feb-1997
. .
Cited – Naturally Yours Cosmetics Ltd v Commissioners of Customs and Excise ECJ 23-Nov-1988
A cosmetics wholesaler offered to a beauty consultant, acting as retailer, a pot of rejuvenating cream at the special price of andpound;1.50. The consultant was to give the cream to a chosen retail customer (referred to as a hostess) as a reward for . .
Cited – Empire Stores v Commissioners of Customs and Excise ECJ 2-Jun-1994
A retail mail-order supplier, had run two promotions, a ‘self-introduction’ scheme and a ‘introduce a friend’ scheme. Under either scheme the introducer (once she or her friend had been approved, placed an order and paid for it) became entitled to . .
Cited by:
Cited – Lex Services plc v Her Majestys Commissioners of Customs and Excise HL 4-Dec-2003
When taking a car in part exchange, the company would initially offer the correct market value. If the customer wanted, the company would agree a higher price. When cars were returned, the company at first reclaimed the VAT on the re-purchase price, . .
Lists of cited by and citing cases may be incomplete.
VAT
Updated: 08 April 2022; Ref: scu.79361
