Value added tax and financial services

Many jurisdictions have kept financial services out of the ambit of their VAT regime. The authors examine whether certain financial services could be covered by a VAT and if yes, how such services could be included under the tax. This first article begins by establishing a working definition of the phrase "financial service". It analyses and critiques the arguments for and against including financial services a broad based VAT, and concludes that financial services should be covered by the tax.