24th March 2010 – FOR IMMEDIATE RELEASE
Today’s Budget announcement to extend the Stamp Duty threshold to £250,000 for first time buyers is a welcome boost to the housing market but the chancellor has failed to address the acute shortage of mortgage finance, says the Federation of Master Builders (FMB).
Richard Diment, Director General of the FMB said:
“Helping first time buyers get on the property ladder is an important step but most people will still struggle to get the funding they need to secure a mortgage despite the Chancellors promise of further lending from state owned banks. The Chancellor could also have taken the opportunity to reform the stamp duty to abolish the slab structure and replace it with a fairer marginal system similar to income tax.”
Diment continued:
“The Chancellor paid a lot of attention to the needs of small businesses which is encouraging as they have been badly hit by the recession. The cut in business rates from October will be a help, as will the delayed introduction of the fuel duty increases. However, these are only temporary measures and future tax increases such as those planned for National Insurance will have a negative impact on small businesses, jobs, and growth.”
Diment added:
“It is disappointing that there wasn’t more emphasis on apprenticeships as these hold the key to prevent a future skills crisis in the building industry. In fact, there is no mention of apprenticeships in the entire Financial Statement and Budget Report, but rather vague commitments to support youth employment. Any investment in key skills must include creating more apprenticeships as they are the key to securing the UK’s competitive future.”
Diment concluded:
“It is disappointing that there the chancellor missed the opportunity to rationalize the VAT treatment of energy efficiency and micro generation measures. The current situation is inconsistent, with £4.5 billion of energy efficiency works attracting the full rate of VAT despite some less efficient measures attracting a reduced rate of 5%. A flat rate of 5% on all energy efficiency measures would produce a more coherent and more readily implementable treatment of energy efficient retrofitting, and a reduction in the VAT rate on the £1.3 billion per year labour element of double glazing and boiler only replacements would only cost £195 million. He has clearly missed an easy cheap common sense move.”
