A VAT cut for housing renovation and repair work is at the top of the New Year’s wish-list for most small and medium-sized construction companies.

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In a survey of members of the Federation of Master Builders (FMB), nearly three quarters said VAT was an issue they wanted the Government to address.

Building regulations, planning and finance were also listed as priority issues by over half the businesses surveyed.

Brian Berry, Chief Executive of the FMB, said: “It comes as no surprise that construction SMEs want this targeted reduction in VAT. Most are still struggling with falling workloads and competition from the informal economy. This is about creating a level playing field and reducing the number of individuals and businesses that rely on avoiding VAT.

“It is also about boosting growth in the economy by making it easier for homeowners and landlords to commission the work they need doing on their properties. Independent research has shown that the Government will quickly make up the initial loss of tax revenue owing to the growth in demand for housing repair and maintenance work.”

He added: “Reduced VAT rates would also encourage more people to introduce measures in their homes to reduce household energy bills and cut CO2 emissions. Such measures already amount to a quarter of all work undertaken in the UK housing repair and improvement market.

“Many European states, including the UK, levy a reduced rate of VAT on the energy consumers use, so it would be perverse for the EU to forbid its member states to discount the rate of VAT on work to help save energy, such as installing energy efficient glazing, new boilers or insulation.”


  • Halving the VAT rate would be a start, but first we need to know how much that would cost and where the lost revenue would come from. Repairing and reusing existing buildings in reasonable nick would make good "Green" sense, and be consistent with Tory hype about being.the greenest party ever. That means it has no chance!!!

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    Friday, January 4, 2013

  • EU legislation has allowed member states on application to apply reduced rates for residential repair work for many years. many European states have taken advantage of these rules in the past. Unfortunately successive UK governments have ignored this potential to boost the construction Industry. It is yet another indictment of the complete failure of government to get to grip with any of the UKs massive infrastructure problems. the problem is so bad now that visiting the UK is like visiting a third world country

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    Friday, January 4, 2013

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