ENGINEERING services alliance Actuate UK is urging UK chancellor Rishi Sunak to use this week’s budget to back a ‘green recovery’ with incentives that support positive changes to the sector.
The organisation wants more support for energy efficiency-related work for homes and buildings. The alliance added that is also wants the UK Government to use its power as a major procurer to reward businesses who demonstrate good practice and support skills development and quality.
Specific asks Actuate UK is calling for include a reduction in VAT to at least 5% or zero for energy efficient products, and rewarding engineering services businesses that adhere to public sector procurement guidelines.
Meanwhile, the Federation of Master Builders (FMB) and the Royal Institution of Chartered Surveyors (RICS) have called for a VAT cut on home improvement works to 5% for a five-year period to help generate an economic stimulus create thousands of new jobs.
The two organisations have published new research – conducted by CBI Economics – which found that cutting VAT on repair, maintenance, and improvement activity for five years would lead to £51 billion total additional output in the construction sector and wider economy.
The FMB and RICS are calling on Rishi Sunak to use the spring budget to make this change. Brian Berry, chief executive of the FMB, explained, “If the chancellor really wants to level up across the country, cutting VAT on home improvements is a win-win, as this research shows. A temporary tax cut will give a much needed boost to small building firms, and unlock additional cash for households to spend on repairs and energy efficiency measures. A measure that the FMB has been calling for, for many years. It will also help the struggling Green Homes Grant scheme, as we know that homeowners are more likely to install green measures as part of wider home improvement works.”
Matthew Howell, UK MD for the RICS, commented, “If the government is serious in its desire to build back better and help level up the country then we have to be bold and do things differently. Cutting VAT on home improvements, as this research highlights, is exactly the sort of fiscal measure which will have a long and positive consequence for the economy, helping to create jobs and opportunities in those areas and industries hit hard by the pandemic, and drive up energy efficiency in many homes and buildings.”
