The Alliance responded to the EC consultation on existing VAT legislation (4 January 2013).
The response focused on the importance, for environmental reasons, for retaining the option in Annexe III for member states to apply a reduced rate of VAT on works to residential buildings in private ownership. Although the UK government has not yet taken up that option, it should remain a possibility.
‘ England has nearly 5million pre-1919 dwellings which account for approximately £6.3bn of residential repair and maintenance output. The recent report Responsible Retrofitting* *(Sustainable Traditional Buildings Alliance 2012) includes plenty of evidence to demonstrate that:
- Traditional buildings can contribute to significantly reducing energy demand without placing these buildings or their occupants at undue risk.
- Traditional buildings often perform better in terms of heat loss through fabric than as stated in standard models and assessment methods.
We therefore recommend that the option to apply a lower rate of VAT on work to residential buildings in private ownership be retained in Annexe III. If this option were to be removed, it would conflict with the five EU priorities for 2020, the third of which relates to climate change / energy, where the target is to reduce greenhouse gas emissions by 20% (or even 30%, if the conditions are right) lower than 1990 and a 20% increase in energy efficiency
We consider that priority should be given to research to understand the energy behaviour and performance of traditional buildings, including addressing the lack of baseline data on which to make judgments relating to energy improvements. This would also support the first of the 2020 priorities, which is that 3% of the EU’s GDP should be invested in R&D.’
See the full response here.