The European Commission's recognition of the benefits of reduced VAT rates for labour intensive services as part of the European Small Business Act (SBA) adopted today is good news for all those who want to see a cut in VAT from 17.5 % to 5% for all maintenance and repair work, says the Federation of Master Builders (FMB) and the European Builders Confederation (EBC).
David Croft, President of the EBC said,
"At last the European Commission recognises explicitly that reduced VAT rates are an instrument for an effective economic policy for small and medium sized builders. This is a very important step forward for the building sector, which, as a result of this directive, benefits from reduced VAT rates on repair and maintenance works of dwellings in a number of countries."
Croft continued,
"Until now the Commission had shown a more neutral attitude, allowing Member States to experiment the measure. The Commission now considers a reduced rate of VAT to have no negative effect on the functioning of the internal market."
Brian Berry, Director of External Affairs at the FMB concluded,
"We have been campaigning for a cut in VAT for building repair and maintenance work for some time so are obviously delighted by this news. The rationale for a cut in VAT is irrefutable. All that is needed now is action from the British Government."
30 June 2008
