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Government is urged to give homeowners the same tax breaks as house builders

November 22, 2013

Britain’s financially squeezed households would benefit from lower cost energy saving measures if the Chancellor were to cut VAT on housing renovation and repair work, according to a broad coalition of campaigners in a letter to George Osborne ahead of his Autumn Statement.

Paula Higgins, Chief Executive of the Home Owners Alliance, said: “It is ridiculous that hard-pressed home owners living in cold, draughty, leaky and cramped houses are being taxed by the Government for trying to make their homes fit to live in. Many home owners can only afford to do essential repairs and maintenance by going to the black market, making honest home owners dishonest.

“Why do homeowners get taxed the full 20 percent tax on mending leaky roofs, putting in double glazing or converting the attic, but housebuilders don’t for building new homes?”

“If the Government is serious about reducing the cost of living, cutting the tax on home repairs is a simple and immediate way to do it. When the Isle of Man did it, the Government found it was such an economic boost that it paid for itself.”

“The UK has among the poorest quality housing in the EU,  and must follow the majority of other European countries in cutting tax on home repairs.”

 

Brian Berry, Chief Executive of the Federation of Master Builders (FMB), said: “The Chancellor should empower home owners to reduce the amount of energy they use. Cutting VAT on domestic building work from 20 to 5 percent will encourage more people to commission refurbishment work and at the same time improve the energy efficiency of their homes.

“Government must give families some control over their seemingly ever-increasing energy bills. Switching suppliers or taking out a long-term fixed tariff can protect against sudden price increases, but the cost of heating our homes is set to rise exponentially for years to come. The only way to stem, or even reverse, these rises is to have new glazing, better insulation or more efficient heating systems installed.”

LLoyd Grossman, Chairman of The Heritage Alliance, another of the signatories to the letter, added: “Compared to other EU countries, we have a much higher proportion of older properties, and many are in desperate need of renovation and repair. A reduction in VAT would certainly help kick-start a big increase in this type of work, and would lead to an enormous improvement to our existing buildings. I believe maintenance, repair and renovation is a crucial issue, and urge the Government to act.”

Notes to Editor

For more on our campaign for the Government to lower the rate of VAT on all domestic building work from 20 percent to 5 percent, to find out which other organisations back the campaign, please visit the Cut the VAT Coalition’s website here.

About the HomeOwners Alliance

The HomeOwners Alliance champions the interests of Britain’s homeowners and aspiring homeowners, and provides services they can trust. We are a member-led organisation, acting as the voice of the homeowner in the media, lobbying for the interests of homeowners and aspiring homeowners in government, and campaigning against bad practices in industry.  At hoa.org.uk, we provide independent advice for the key moments in owning a home, supported by legal and industry experts.

We directly engage with government and the media by conducting independent research and publishing reports that promote and champion the interests of homeowners. Sunday Times wrote: “with the launch of the HomeOwners Alliance, British property owners finally have an ally”.

About the Federation of Master Builders

The Federation of Master Builders (FMB) is the UK’s largest trade association in the building industry. Established in 1941 to protect the interests of small and medium-sized building firms, the FMB is independent and non-profit-making, lobbying for members’ interests at both national and local levels.

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