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VAT to be scrapped for Scottish police and fire services

Chancellor Phillip Hammond is to confirm the move during the Budget announcement.

Budget: The VAT break will be announced during the budget on Wednesday.
Budget: The VAT break will be announced during the budget on Wednesday. PA

The Chancellor is to announce police and fire services in Scotland will no longer be liable for VAT.

In his Budget on Wednesday, Phillip Hammond will confirm the services will receive refunds for any future payments.

This will bring the services in line with their UK counterparts.

Despite a push by Scottish MPs, they are not expected to be reimbursed for previous years in which VAT has been paid.

Currently, the services pay around £35m in VAT a year, which only came into effect after the regional forces were merged into a national service in 2013.

Scotland's finance secretary Derek Mackay is also urging the Chancellor to think again on proposed public spending cuts and to pause the roll-out of universal credit, which combines several benefits into one payment.

Hammond is expected to use his Budget speech at the House of Commons to set out a vision for "global Britain" with a "prosperous and inclusive economy where everybody has the opportunity to shine wherever in the UK they live, whatever their background".

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