Over 50,000 jobs could be created if the Government cut VAT on residential repair and maintenance, according to new research.
The Cut the VAT coalition report from Experian estimates that more than 24,000 construction jobs and 31,000 wider economy jobs would be created by a cut to 5% VAT on the labour element of such work.
The coalition, which includes the Federation of Master Builders and Royal Institute of Chartered Surveyors, presented the report at the House of Commons today.
The research also suggests that the VAT cut would contribute more than £1.4bn to the UK economy in 2010, rising to £17bn by 2019.
The VAT cut could also release an extra £450m a year for investment in the UK’s social housing stock, enough to bring approximately 19,000 homes per year up to the Government’s Decent Homes Standard.
FMB director general Richard Diment said: “Housebuilding in the UK is at its lowest level since 1946 so building zero carbon homes will have a limited impact on the UK’s carbon emissions, especially considering the existing UK housing stock is responsible for 27 per cent of total UK carbon emissions.
“A more effective way to reduce carbon emissions would be to ‘green’ the existing housing stock.
“Cutting VAT would mean that many more homeowners could afford to have their homes retrofitted which would also create savings for them on energy bills, leading to a reduction in fuel poverty.”