What changed?
The current Tour Operators’ Margin Scheme and related travel-services VAT rules remain in force.
HMRC is gathering evidence on whether to reform, simplify or withdraw TOMS and on the treatment of UK-consumed travel supplied from overseas.
Practical consequence: Travel businesses should document practical problems and respond by 31 January 2027; the consultation itself changes no liability.
What happened?
HMRC opened a call for evidence on 28 October 2026 concerning VAT on travel services, including the Tour Operators’ Margin Scheme.
Key details
The review asks whether TOMS is fit for purpose and examines reform, simplification or withdrawal. It also considers UK-consumed travel supplied from overseas, margins, wholesale supplies, input tax and package components.
Who is affected?
Tour operators, travel wholesalers, overseas providers and business customers arranging conferences or employee travel may have relevant evidence.
Effective date / timing
The call for evidence opened on 28 October 2026 and closes on 31 January 2027. It is evidence gathering, not enacted legislation.
Why it matters
Future reform could change pricing, registration, input-tax recovery and competition between domestic and overseas providers.
Business impact
Businesses should quantify compliance costs, identify distortions and submit transaction-based evidence. Current VAT treatment continues meanwhile.
Investment impact
Any eventual reform may alter the relative economics of UK travel distribution models, but no final policy has been selected.