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Salmond demands VAT cut on home improvements

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Scotland’s first minister has called on the government to cut VAT on home improvements to help boost the UK’s stuttering economy

Alex Salmond has called on a ‘conservatory tax’ cut from 20 per cent VAT to five per cent to help boost the construction trade.

Salmond’s call was also backed by the Scottish Building Federation, which found in a survey two years ago that half of homeowners would consider investing in their home if they were given a tax incentive.

Architect Malcolm Fraser told the AJ: ‘This is something that I’ve been telling Scottish ministers every time I see them.

‘But it’s not as liberating and radical as the other alternative of making it five per cent across all construction.’

He added: ‘The current situation with VAT is bizarre, a massive structural imbalance that, in adding 20 per cent to their costs in comparison with zero for their demolition, hugely penalises the repair of buildings and encourages their destruction.

‘Levelling VAT on newbuild and repair would, at the flick of a switch, redirect investment into the repair of existing homes.’

Alan Dunlop, director of Alan Dunlop architects, said: ‘Whether cutting it to five per cent makes any real difference I don’t really know, but anything that helps get architects back into work has to be a good thing.’

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Readers' comments (1)

  • I totally agree with Mr Salmond, I have had numerous conversations with clients where they stare at me in disbelief when I tell them that VAT is applied to refurbishment but not to new-build.

    There should be an incentive to improve existing buildings, bringing them up to, and beyond, current standards

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