The Green Party has pledged to cut VAT on all housing repairs and renovations
The party has said it will cut VAT to just five per cent on home improvements as part of its 2015 election commitment.
It estimates the VAT cut would cost around £6.6 billion over the next five years but would provide a lift of around £15 billion for the UK’s economy.
Tom Chance, Green Party housing spokesperson, said: ‘This VAT cut would be a real boost for green jobs and warm homes. It comes at a time when we desperately need to be investing in a nationwide home insulation scheme, to cut bills and end the scandal of fuel poverty.
He added: ‘This election presents Britain with a chance to vote for change. This VAT cut, just one of an array of bold policies from the Green Party, demonstrates our commitment to building a Britain of warm, comfortable homes.’
The move comes after a long campaign by the industry urging the government to provide VAT relief for refurbishment projects as a potential replacement to the failed Green Deal.
Many in the sector believe a long-campaigned-for reduction in VAT on all renovation and repair work from 20 per cent to 5 per cent would be more effective in encouraging homeowners to take on energy efficiency projects.
The Federation of Master Builders (FMB) which had launched a campaign to ‘Cut the VAT’, welcomed the Green Party’s election pledge.
‘A VAT reduction on housing renovation and repair work will empower home owners to contribute to growth, jobs and greener homes. There is no other proposal that will help the UK achieve so many of its economic, environmental and social aims with so little cost to the public purse,’ said FMB chief executive Brian Berry.
He added: ‘Independent research shows that the wider benefits of a VAT reduction on housing renovation and repair would stimulate more than £15 billion of wider economic activity, which completely overshadows any direct losses to Treasury coffers due to a drop in the percentage charged for VAT.’
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