ONE of the region's flagship arts venues is in line for a £20,000 tax rebate, after a mix-up over fuel payments.

The Arc, in Stockton, will get the refund from its utility suppliers, after it was discovered to be paying 12.5 per cent VAT more than necessary.

The find came during a utilities audit run by the North East Chamber of Commerce.

The chamber set up the scheme to ensure its members were not paying over the odds for electricity and gas.

Businesses have to pay the standard 17.5 per cent VAT rate, but registered charities such as Arc only pay 5 per cent. Arc will further benefit because charities are also exempt from paying the climate change levy, normally a further surcharge of 10 per cent.

Gary Watson, the chamber's head of commercial services, said: "The responsibility should lie with the suppliers to let charities know they can save massive amounts on their VAT bill, but too often this doesn't happen.

"Our audit is already saving members thousands of pounds."

Kevin Parker, Arc director, said: "We are delighted that we will see a return of some of our previous expenditure.

"However we are concerned that suppliers are not required to make charities aware of potential savings."

For more information on the audits, call 0870 759 1550.