VAT Update

Thank you to all our members who have written to both us and their MP’s about the VAT changes, we are encouraged by the number of responses we’ve received.

As you know we’ve joined forces with over 20 similar organisations who attended a meeting with David Gauke, Exchequer Secretary to the Treasury, on 17th May who seemed to be in listening mode on the whole, and once again said he had ‘some sympathy’ about extending transitional relief but evidence would be needed to convince HMRC.  We shall continue working on this with every effort.

You may also have seen the letter from our collective organisations published in the Daily Telegraph following our meeting:
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Sir,

By removing the zero rate of VAT on alterations to listed buildings, the Government is making it harder to protect our treasured heritage. The careful stewardship and updating of historic buildings is not an easy task. Alterations to listed buildings require specialist craft skills and building materials, and the type of building works allowed are carefully controlled by Listed Building Consent. 

Despite what government ministers have implied, the 20% tax hike will not simply apply to new swimming pools for grand houses. Owners of listed buildings span the social and economic divide. According to English Heritage, 47% of people who live in listed buildings are the professionals and senior managers in social classes A and B, but 44% are in classes C1, C2 and D.

Far from being a tax break for wealthy mansion owners, the VAT relief on alterations to listed buildings is almost the only remaining incentive available to those who are willing to care properly for our historic built environment.

Since the last Spending Review the Government has cut heritage sector funding by more than £650 million per year and responsibility for heritage conservation now falls almost entirely on the private and charitable sectors. We can only assume the Government has missed the obvious link between this targeted VAT relief and its own ambition to create the ‘Big Society’.

Unless the Government steps away from this planned tax increase, it will be responsible for very real damage to the UK’s heritage and a further brake on the economic recovery.
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As I said we are continuing our efforts with this issue but it would be helpful if members maintain pressure on their MP’s and get as many other owners to sign the e-petition by 26th June 2012: http://epetitions.direct.gov.uk/petitions/32056 which currently numbers 11,936 signatures.
Going forward we have a second meeting next week with the other 20 similar organisations including Federation of Master Builders, Historic Houses Association, Heritage Alliance etc. at which we shall agree a joint letter to David Gauke to repeat our opposition as well as offering some more detailed suggestions and arguments for improving the transitional arrangements.  Utopia would be for the complete reversal of the ruling but failing this we shall be aiming for proposed changes/improvements to include:

· A change in the qualification for zero rate during the transitional period from having a contract in place on 21 March 2012 to having demonstrated substantial fee expenditure / applied for LBC by that date.

· An extension in the closing date for work to have been completed, from March 2013 to March 2015.

We’d welcome any other suggestions/thoughts – please email them to: info@lpoc.co.uk