The VAT treatment of contracts involving currency, interest rates, securities or indices will be different from that for hard and soft commodities. The Black Box arrangements are not available. Also, most transactions will be exempt rather than taxable. In particular:

currency contracts are basically exempt transactions involving money (VATA 1994, Sch. 9, Grp. 5, item 1 and art. 135(1)(d) of Directive 2006/112);

long and short interest rate contracts are similarly exempt, essentially as transactions involving credit (item 2 of Grp. 5 and art. 135(1)(b));

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