Builders urge VAT cut to boost spending on home

Published on Sunday 1 November 2009 19:18

HALF of Scottish homeowners would spend money on building work if VAT on home improvements was cut to 5 per cent, the Scottish Building Federation (SBF) claimed today.

The SBF repeated its call for a targeted cut in VAT on home building works to support the construction industry.

Michael Levack, the SBF's chief executive, said: "All the evidence suggests that the 2.5 per cent cut in the standard rate of VAT has failed because it wasn't suitably targeted. Our new survey shows that a more substantial but narrowly focused cut in VAT on home building works would succeed where the blanket 2.5 per cent cut has failed.

"In short, one in every two Scottish homeowners would spend more as a result."

He said the building sector was treated as the "poor cousin" to other industries, highlighting the UK government's scrappage scheme to help car makers.

Levack said a VAT cut would help to "green" homes by making energy efficiency improvements cheaper for consumers.