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This item of news appeared in the latest edition of Heritage Link:
Heritage bodies lobby Chancellor over VAT option
The campaign for a change to VAT regulations across the UK had reached a critical moment. The historic environment sector has campaigned for years for a change to the EU sixth VAT Directive to permit a reduced rate of VAT to be applied to the repair and maintenance of buildings. One proposal, to amend the wording in Annexe H which enables members states to reduce VAT to the lower rate for (amongst other things) ‘supply, construction, renovation and alternation of housing provided as part of a social policy’, came to nought when the removal of the social policy stipulation was not agreed.
There is a window of opportunity however over Annexe K relating to the so-called labour intensive experiment, designed to create jobs. This permits a Member State to use a reduced rate of VAT for ‘renovation and repairing of private dwellings, excluding materials which form a significant part of the value of the supply’. To date the UK has only operated this in the Isle of Man - for reasons known only to the Government.. The Council Directive 2006/18/EC now permits the continuation of Annexe K in so far as it refers to buildings until 2010. It will extend the scheme to the 25 EU countries but most crucially asks Member States to communicate with the European Commission by 31st March if they wish to implement it.
English Heritage, Heritage Link and others are pressing Government to take up this opportunity. The application does not commit the Government to exercise the option to introduce a reduced rate of VAT but allows it to take up the option at any time over the next five years. A decision not to apply would close off this option, possibly indefinitely if Annexe K is not renewed again.
Heritage Link points out in its letter to the Chancellor of the Exchequer the benefits of reducing VAT on the renovating and repair of private dwellings. It would remove the distortion in the housing market as well as the obvious disincentive to maintenance. A reduction would also help the heritage sector address the cumulative backlog of repairs needs to historic buildings and equip it to make a full contribution to the economic and cultural health of the nation. Greater resulting economic activity would support employment and retention of conservation skills as well as give a boost to building preservation trusts and others to carry out local regeneration schemes. Altogether, greater scope for these initiatives would counteract the misconception that preservation of historic buildings is a block to regeneration.
If you can add your voice to persuade the Chancellor….. Back
Early Day Motion on VAT - has your MP signed it?
Supporting the option to implement Annexe K, Gordon Banks, MP for Ochill and South Perthshire tabled an Early Day Motion (no 1695) VAT on Domestic Building Work:
‘That this House notes that the Government has the right until 31st March to propose a reduced rate of VAT for domestic building work; supports the Government in its drive to improve the quality of domestic building work through the TrustMark initiative; and urges the Government to support the TrustMark by reducing the rate of VAT on domestic building work to five per cent., thereby depriving rogue builders of their commercial advantage.’
An EDM is a motion put down by Members of Parliament calling for a debate on a particular subject. In practice, as there is rarely time to debate EDMs, they enable MPs to draw attention to an issue and to canvass support for their views by inviting other Members to add their signatures in support of the motion. So far 30 MPs have signed this one.
Please check the EDM website to see if your MP has signed http://edmi.parliament.uk/EDMi/EDMDetails.aspx?EDMID=30142&SESSION=875 and if not, explain to him/her why he should! Back
VAT off Professional Fees?
Also as part of the VAT lobby, the Ecclesiastical Architects and Surveyors Association (EASA) is mounting a campaign to allow recovery of VAT of professional fees paid in connection with repairs to historic churches and chapels. The Association is pointing out to the Parliamentary Historic Churches All Party Committee that the Listed Places of Worship Grant Scheme although intended to assist and encourage repairs to historic churches excludes all professional fees incurred in the carrying out of repair works.
The Association argues that the charitable nature of parish administration does not always ensure appropriate forms or receipted VAT invoices are kept and much time is spent by professional advisers on paperwork. As the analysis, specification and administration of repair work is carried out by architects and surveyors under the Churches Measure, professionals undertake as much work and bear as much responsibility as the contractors executing the repairs. Removing the burden of the 17.5% surcharge on professional fees would, EASA points out, enhance the prospects of the Listed Places of Worship Scheme.
http://www.heritagelink.org.uk
Heritage bodies lobby Chancellor over VAT option
The campaign for a change to VAT regulations across the UK had reached a critical moment. The historic environment sector has campaigned for years for a change to the EU sixth VAT Directive to permit a reduced rate of VAT to be applied to the repair and maintenance of buildings. One proposal, to amend the wording in Annexe H which enables members states to reduce VAT to the lower rate for (amongst other things) ‘supply, construction, renovation and alternation of housing provided as part of a social policy’, came to nought when the removal of the social policy stipulation was not agreed.
There is a window of opportunity however over Annexe K relating to the so-called labour intensive experiment, designed to create jobs. This permits a Member State to use a reduced rate of VAT for ‘renovation and repairing of private dwellings, excluding materials which form a significant part of the value of the supply’. To date the UK has only operated this in the Isle of Man - for reasons known only to the Government.. The Council Directive 2006/18/EC now permits the continuation of Annexe K in so far as it refers to buildings until 2010. It will extend the scheme to the 25 EU countries but most crucially asks Member States to communicate with the European Commission by 31st March if they wish to implement it.
English Heritage, Heritage Link and others are pressing Government to take up this opportunity. The application does not commit the Government to exercise the option to introduce a reduced rate of VAT but allows it to take up the option at any time over the next five years. A decision not to apply would close off this option, possibly indefinitely if Annexe K is not renewed again.
Heritage Link points out in its letter to the Chancellor of the Exchequer the benefits of reducing VAT on the renovating and repair of private dwellings. It would remove the distortion in the housing market as well as the obvious disincentive to maintenance. A reduction would also help the heritage sector address the cumulative backlog of repairs needs to historic buildings and equip it to make a full contribution to the economic and cultural health of the nation. Greater resulting economic activity would support employment and retention of conservation skills as well as give a boost to building preservation trusts and others to carry out local regeneration schemes. Altogether, greater scope for these initiatives would counteract the misconception that preservation of historic buildings is a block to regeneration.
If you can add your voice to persuade the Chancellor….. Back
Early Day Motion on VAT - has your MP signed it?
Supporting the option to implement Annexe K, Gordon Banks, MP for Ochill and South Perthshire tabled an Early Day Motion (no 1695) VAT on Domestic Building Work:
‘That this House notes that the Government has the right until 31st March to propose a reduced rate of VAT for domestic building work; supports the Government in its drive to improve the quality of domestic building work through the TrustMark initiative; and urges the Government to support the TrustMark by reducing the rate of VAT on domestic building work to five per cent., thereby depriving rogue builders of their commercial advantage.’
An EDM is a motion put down by Members of Parliament calling for a debate on a particular subject. In practice, as there is rarely time to debate EDMs, they enable MPs to draw attention to an issue and to canvass support for their views by inviting other Members to add their signatures in support of the motion. So far 30 MPs have signed this one.
Please check the EDM website to see if your MP has signed http://edmi.parliament.uk/EDMi/EDMDetails.aspx?EDMID=30142&SESSION=875 and if not, explain to him/her why he should! Back
VAT off Professional Fees?
Also as part of the VAT lobby, the Ecclesiastical Architects and Surveyors Association (EASA) is mounting a campaign to allow recovery of VAT of professional fees paid in connection with repairs to historic churches and chapels. The Association is pointing out to the Parliamentary Historic Churches All Party Committee that the Listed Places of Worship Grant Scheme although intended to assist and encourage repairs to historic churches excludes all professional fees incurred in the carrying out of repair works.
The Association argues that the charitable nature of parish administration does not always ensure appropriate forms or receipted VAT invoices are kept and much time is spent by professional advisers on paperwork. As the analysis, specification and administration of repair work is carried out by architects and surveyors under the Churches Measure, professionals undertake as much work and bear as much responsibility as the contractors executing the repairs. Removing the burden of the 17.5% surcharge on professional fees would, EASA points out, enhance the prospects of the Listed Places of Worship Scheme.
http://www.heritagelink.org.uk