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The government's proposals to reform VAT to encourage the refurbishment of churches have received a major setback, according to reports coming from the European Commission, which has the final say over changes to the tax. Chancellor Gordon Brown said last year he wanted to cut VAT on church refurbishment and would ask Brussels to allow the change. But recent statements from the commission suggest that any changes in the VAT regime will not be considered until at least 2002, and even then will have to be agreed by all 15 member states.

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