Government reform
VAT cut on building repair and maintenance work
The Federation of Master Builders (FMB) has welcomed government reforms of empty property rates, but argues measures must go further to ensure buildings come back into use.
New changes for empty properties came into force on April 1 this year, following announcements in the 2007 Budget, with the aim of encouraging the return of derelict and unused buildings to the market.
The changes will see an increase in the empty property rate from 50 to 100 per cent of the basic occupied business rate.
It is hoped this will encourage owners to re-let, re-develop or sell their properties to reduce the need for new development on Greenfield sites.
Other modifications will tackle deliberate dereliction by ensuring those who consciously render their property beyond economic repair continue to be liable for empty property rates.
"These changes to empty property rates will encourage owners to keep their premises in use, revitalising deprived areas as new businesses move in bringing much-needed employment opportunities, and making these towns and cities better places in which to live," explained local government minister, John Healey.
However, while welcoming the changes, the FMB contends cutting VAT on all building repair and maintenance work from the present rate of 17.5 per cent to 5 per cent would be expedient in ensuring disused properties were returned to operation.
"The FMB welcomes any moves by the government to bring empty buildings back into use. Bringing empty buildings back into beneficial use, in both town and country, is an essential part of sustainable development and improving people's quality of life," said Brian Berry, director of external affairs at the FMB.
However, the organisation which represents the interests of 13,000 UK builders argues that more needs to be done.
"The 17.5 per cent rate of VAT is an unacceptable brake on the regeneration and re-use of vacant and under-used buildings," continued Mr Berry.
"It favours new build over re-use, and therefore greater use of finite resources like greenfield land and minerals and higher carbon emissions. It actively encourages neglect and decay."
