The Bathroom Manufacturers Association is calling on new Chancellor Rishi Sunak to cut the rate of VAT on home improvements in the upcoming budget.
Reducing the 20% tax on home improvement will make bathroom upgrades more affordable, driving water efficiency and reducing the number of void homes, says the trade body.
Before the General Election BMA backed a National Home Improvement Council campaign to cut improvement VAT from 20% to 5%. It’s believed that such a measure could:
- Create up to 95,000 jobs
- Generate £15bn in new taxes
- Unlock £1bn green revolution
- Reducing VAT from 20%to 5% will stimulate the economy to become net zero carbon
The budget is scheduled for 11th March is the first opportunity for the new Government to introduce such a tax cut. BMA Chief Executive Tom Reynolds said: “The BBC’s Housing Briefing estimates a 1.2 million shortfall in homes in the UK. A VAT cut for home improvements would help that situation, by making the improvements needed to void homes more affordable.”
A VAT cut could also boost the eco-credentials of the UK’s housing stock, Reynolds believes. He said: “One barrier to home-owners and landlords updating bathrooms is the cost, 20% of which goes straight to the HM Treasury. If the Chancellor reduces VAT on home improvements investing in more modern and water efficient bathrooms would become much more attractive.”