Thursday 18th November 2010 - FOR IMMEDIATE RELEASE
The planned rise in VAT to 20 per cent in January next year will harm the construction sector and thousands of households in Wales but a targeted cut in VAT would create over 1,500 new construction jobs in Wales by 2019. This is the joint message from Joyce Watson AM and Federation of Master Builders (FMB) in Wales.
Independent research commissioned by the Cut the VAT coalition, which is led by the FMB, reveals that a reduction in the current rate of VAT to 5 per cent would result in job creation whereas a rise in VAT to 20 per cent would mean a loss of 11,400 UK construction jobs during the decade.
Joyce Watson AM said:
“The Welsh Assembly Government and the UK Government must work together to cut VAT in targeted ways in order to help the UK become a low carbon economy. Last year the European Union gave Member States the right to permanently reduce the rate of VAT to five percent, which means the UK Government has a unique opportunity to kick-start the economy and raise the standard of living for millions of people. I am encouraging my fellow Welsh Assembly Members to sign up to the Statement of Opinion and push the UK Government to introduce this measure to create jobs, eliminate cowboy builders, help those who cannot afford vital repairs to their homes and help achieve the UK’s legal requirement of cutting CO2 emissions by 80 percent by 2050.”
Richard Jenkins, Director of FMB Wales added:
“Construction has been badly hit by the down turn, thousands have already lost jobs and many construction firms have gone bust. The VAT rise will be a huge blow to many companies already struggling but a targeted cut in VAT could be a lifeline for many small construction firms. As well as creating jobs the VAT cut would benefit homeowners by helping to eliminate cowboy builders who cost the Treasury millions every year in lost revenue. It would also incentivise homeowners to make their homes more energy efficient and help them save money on their escalating fuel bills.”
Note to editors
The Statement of opinion says:
This Assembly believes that:
In line with calls from the Federation of Master Builders (FMB), the UK Government should reduce the current rate of VAT from 17.5 percent to 5 percent for all maintenance and home improvement work.
The cut would:
- benefit millions of UK homeowners by helping to eliminate cowboy builders;
- help bring back empty properties into use and reduce pressure on green field development;
- help achieve the UK’s legal requirement of cutting CO2 emissions by 80 percent by 2050; and
- create thousands of new jobs in the construction sector, including 1,500 new construction jobs in Wales alone.
EU ruling on VAT
On March 10th 2009 the Ecofin Council, the committee of finance ministers from across EU member countries, gave EU Member States the right to permanently reduce the rate of VAT to 5 percent, which means the UK Government has a unique opportunity to kick-start the economy and raise the standard of living for millions of people.
Joyce Watson AM
Elected in May 2007, Joyce Watson has firm links with Mid & West Wales, and has served her community for many years. As an Assembly Member, Joyce has been actively involved in a number of high profile campaigns on behalf of her constituents in Mid & West Wales and Wales wide. These include launching the Women in Construction campaign (www.womeninconstruction.co.uk); campaigns to highlight the risk of undiagnosed high blood pressure and the risk of stroke; a campaign to change the planning laws in Wales to deal with Surface Water Flooding through the proposal for a Legislative Competence Order (LCO); and a campaign to highlight and tackle the issue of Human Trafficking in Wales. On the 25th May 2010, as Chair of the Cross-Party Group on the Trafficking of Women and Children, Joyce published a report titled, ‘Local Solutions to an International Crime: Trafficking of Women and Children in Wales 2010’.