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Further points about VAT and Brexit, following on from this thread (why @michaelgove’s idea of getting rid of VAT is a bad one).
Note that an EEA/stay in single market type Brexit takes you outside the EU VAT system. The EEA 3 are not bound by EU VAT rules (though they choose to have VAT anyway).
But a price of that is some friction at the border: see uktradeforum.net/2018/10/09/wha….
And also uktradeforum.net/2018/11/12/wha…
The gain in leaving the EU VAT area - even if you decide to keep VAT - is greater ability to change exclusions/exemptions.
You might decide to raise more money by slashing back the exemption for financial services, for example.
Or zero rate certain products (cf tampons). Though note that the EU straitjacket on reduced rates is much less tight than it was.
The problem with greater freedom though is the temptation to tinker - to add new exclusions and exemptions.
These may grab headlines and do some good. But, generally, exemptions and exclusions are an efficient way of redistributing resources into the pockets of tax lawyers and accountants, and businesses with the resources to engage in tax avoidance. So be careful what you wish for.
