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Slash VAT on home improvements to unleash ‘£1 billion green revolution’

Shutterstock house renovatino retrofit
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More than 20 major construction and property industry bodies have urged party leaders to slash VAT on home improvements and kickstart a ‘£1 billion green revolution’

The Federation of Master Builders (FMB) and the Royal Institute of Chartered Surveyors (RICS) are among those proposing a cut to the VAT rate from 20 per cent to 5 per cent to stimulate investment in improving existing housing stock.

The coalition of organisations has sent a letter to the leader of the four largest parties in Westminster to invite them to advocate for the policy.

The group suggests the tax cut could create 95,000 jobs and ‘unleash’ £1 billion of investment in energy efficiency measures, alongside an further £14 billion in other home improvement works. 

It also says the change is vital to ‘green[ing] the nation’s homes’ in a bid to becoming carbon-zero by 2050.

And, the coalition says, a VAT cut on home improvements would also boost new-build housing by cutting costs for build-to-rent operators.

Brian Berry, chief executive of the FMB, said: ‘An amazing 20 million floors, 8 million lofts and 5 million cavity walls are in need of insulation across the UK, according to the government’s own figures.

‘The four main parties must go further in their policy pledges to promote and incentivise energy efficiency works.’

Jack Pringle, former RIBA president and EMEA director at Perkins and Will, threw his support behind the measure: ‘A VAT cut on home improvements and refurbishments would have a significant effect on the built environment’s ability to reach net-zero by the middle of the century.

‘It’s the existing building stock that remains the big greenhouse gas emitter with no systemic way of being tackled. Without shifts in taxation and policy, a huge amount of it will remain inefficient to run and financially unviable to retrofit.’

Pringle added: ‘I would encourage the RIBA and the Construction Industry Council to get behind this initiative.’ 

The call echoes one of the three demands set out in the AJ’s own RetroFirst campaign, which was launched earlier this year to promote and incentivise the reuse of existing buildings as a key means of tackling the climate emergency and also advocates cutting VAT on refurbishment work to 5%.

RetroFirst is urging the government to take action in two other key areas besides tax – procurement and policy – and has already won support from a raft of big name architects including 11 RIBA Stirling Prize-winning practices.

The signatories to the letter to political parties

  • Bathroom Manufacturers Association
  • British Blind and Shutter Association
  • British Property Federation
  • British Woodworking Federation
  • Builders Merchants Federation
  • CPRE The Countryside Charity
  • Civil Engineering Contractors Association
  • Chartered Institute of Building
  • Country Land and Business Association
  • Countryside Alliance
  • Electrical Contractors’ Association
  • Federation of Master Builders
  • The Heritage Alliance
  • HomeOwners Alliance
  • Insulation Manufacturers Association
  • National Federation of Builders
  • National Home Improvement Council
  • National Landlords Association
  • Roof Tile Association
  • Royal Institute of Chartered Surveyors
  • Scottish Building Federation
  • UK Green Building Council
  • The VAT Consultancy

RetroFirst Logos 2019 2

RetroFirst Logos 2019 2

How you can get involved

Follow the progress of RetroFirst using #RetroFirst on social media
Contact us at retrofirst@emap.com to back the campaign

  • 1 Comment

Readers' comments (1)

  • COLINDB

    It is an anomaly to raise VAT to 20% on repairs to existing fabric, compounded by approved alterations to Listed Buildings VAT relief cancelled in 2012. Whereas in France a 5% level has been set for similar projects. The EU offers a common framework of reference, which Whitehall sets to its own levels of VAT or a purchase tax. Likewise UEFA organises diverse football matches using a common framework, as does FIFA.

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