The Green Party has revealed that it will cut VAT on all housing repairs and renovations if it were to win the General Election.
At the moment the government charges a 20% VAT rate but the Greens would drop the rate down to 5% – the lowest European laws will allow.
The Greens point to economic research carried out by Experian which predicts that dropping the VAT rate from 20% to 5% would create 42,000 full time construction jobs from 2015 to 2020 in addition to 53,000 jobs in the wider economy.
The party hopes that the VAT cut will help incentivise Brits to ‘green’ their properties. The UK suffers from some of the least efficient housing stock in Europe and scheme’s such as the Green Deal have failed to translate into significant deployment of energy saving measures.
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.
“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 Green Party estimates that the VAT cut would cost £6.6 billion over the five years but estimates that it would create an economic stimulus of £15 billion for the wider economy.
Brian Berry, chief executive of the Federation of Master Builders, concluded: “A VAT reduction on housing renovation and repair work will empower homeowners 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. 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.”