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Ruckus continues over 20% VAT plan for heritage buildings

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The government has come under fresh fire for its proposed VAT levy on alterations to listed buildings with critics claiming it had failed to provide an adequate transition period for affected projects

Under detailed proposals unveiled last week, clients which had not managed to finalise contracts or achieve listed building consent before 21 March will have to pay 20 per cent VAT on all works carried out after 1 October.

Jim Gempton, director of VAT services at PKF Accountants and business advisers said: ‘It is bad enough that this relief is being phased out, but not giving the voluntary sector advance notice of the 21 March deadline has left many project teams facing a 20 per cent shortfall in their funding because it will be practically impossible to get the work finished by 1 October.’

He added: ‘Although public campaigns on the pasty tax and caravans succeeded in forcing Government U-turns, this change now looks certain to go through and is likely to cause huge damage in the long run – works on historic buildings are bound to suffer as a result, and some buildings will go to rack and ruin.’

In a statement, umbrella organisation The Heritage Alliance said it was ‘disappointed’ the government had refused to reconsider the new tariff.

The proposals – contained within The Finance Bill – are expected to be debated in the house of commons this evening (3 July).

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