An historic military aircraft, which was Britain’s last line of defence in the Cold War, has been hit by an unexpected VAT tax bombshell from Brussels.
The Vulcan, the last all-British designed and built military aircraft, was on around-the-clock standby to drop the atomic bomb on the Soviet Union during the East-West stand-off.
The Vulcan To the Sky Trust, which displays the last flying vulcan – the XH558 – at air shows during the summer, battles constantly to raise funds every year to keep the aircraft in the air.
But from this year the charity must raise an extra £100,000 annually after the UK came in line with EU legislation, which means that VAT now applies to the cost of spare parts and maintenance for the Vulcan.
Michael Trotter, the trust’s business development director, said: “It has hit our cash flow right now because the aircraft has just been through the winter service, we had to buy components for the aircraft, and they are subject to 20 per cent tax.
“I have a fairly even-handed view of it. The law is the law. We have to comply with it.
“We have to challenge ourselves to go out and find the extra cash to cover the tax.
“There’s no use being upset. We need to be sanguine and get on with it. It has just added a challenge to our fundraising we weren’t expecting.”
The last flying Vulcan thrilled almost two million people last year and this summer is booked for an extended season at about 30 air shows across the country.
The aircraft, built in 1960 and restored between 2005 and 2007, is being looked after at RAF Lyneham by a team of 11 people, including five engineers.
An appeal in October raised about £415,000 to maintain the aircraft over winter. An enhanced online merchandising effort brought in extra funds to cover the upkeep of the aircraft until mid April.
The charity has now launched another appeal to generate a further £350,000 by the end of May or the XH558 could be grounded.
Dr Robert Pleming, the chief executive of the trust, said the problem had been compounded by increased fuel costs. He said: “We risk running out of money ahead of the air shows.
“One significant reason is that the VAT regulations applying to large non-commercial aircraft like the Vulcan were changed with very little warning at the beginning of January.
“This means the imposition of 20 per cent VAT on all the parts and services for the maintenance of XH558, which up until then were zero-rated. Added to this, our fuel budget is nearly double that originally planned.”
To support the appeal call 0845 5046 558 or visit the website www.vulcantothesky.org/donate.