VAT ON WORKS TO EXISTING SOCIAL HOUSING

Motion Text

That this House welcomes the Chancellor's announcement in the Budget that VAT on residential conversions will be reduced to 5 per cent., but understands that this will affect only 1,000 social housing properties each year; notes that reducing VAT to 5 per cent. for all works to existing social housing would cost around ú140m; further notes the National Housing Federation's estimates that the increased tax-yield from stimulating construction industry activity would bring the net cost to Government to less than half this figure; believes that a 5 per cent. VAT rate for works to existing social housing would help to achieve the Government's stated aim of bringing all social housing to a decent standard by 2010; and urges the Chancellor to include this measure, which is permitted under the Sixth EU VAT Directive, in his Pre-Budget Report and the Spring Budget statement.