THE ROOF TILE ASSOCIATION is one of a number of organisations that has called on the next government to cut VAT on home improvements to help meet carbon emissions targets.
According to the coalition of business groups and organisations from across the property and construction sector, reducing VAT from 20% to 5% on home improvement works would unleash investment in housing, stimulate the economy and enable the UK’s transition to net zero carbon.
It would also have the potential to generate £15bn in new taxes, create 95,000 jobs and unlock a £1bn green revolution.
Domestic buildings are responsible for around 20% of the UK’s carbon emissions.
The group has written to the four largest parties at Westminster outlining their thoughts on the matter and the wider benefits the move could bring.
Improving build to rent
In addition to improving the standards of older homes and those in rural areas, the VAT cut would also help unleash investment in new housing. Build-to-rent (BTR) is a relatively new asset class in the UK that provides high quality, purpose-built and professionally managed homes.
The BTR sector has grown from fewer than 30,000 homes to 148,000 homes in the last five years which included delivering a quarter of London’s housing output last year. By reducing the irrecoverable VAT associated with maintenance and management of BTR, the sector can deliver even more, the letter said.
Melanie Leech, Chief Executive of the British Property Federation, said: “Reducing the rate of VAT on all repairs, maintenance and management of residential property would support the greening and improvement of our housing stock, and help the build to rent sector deliver more homes.
“We therefore urge the next Government to support the Cut the VAT campaign.”
Brian Berry, Chief Executive of the Federation of Master Builders, said: “An amazing 20 million floors, 8 million lofts and 5 million cavity walls all 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.
“Given that homeowners tend to complete these tasks as a consequence of larger home improvement works the rate of VAT on repair and maintenance work needs to be reduced from the current 20% to 5%.”
The full list of organisations calling for the VAT cut is: 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.