The Federation of Master Builders (FMB), together with 30 organisations in the construction industry, is calling on the Government to stop reverse charge VAT, a new tax policy due to be introduced on 1 March 2021. The coalition sent an open letter to the Chancellor of the Exchequer on 14 January, arguing that the policy should be removed. This letter follows a previous joint communication sent on 10 December, but which had not received a response.

Brian Berry, Chief Executive of the FMB, said: "The Government must withdraw reverse charge VAT as a matter of urgency, to avoid a significantly negative impact on recovery in the construction industry from 1 March 2021. The industry has strongly welcomed the business support from the Government over the past year, and the clear messaging that construction in England should continue. However, both cash flow, and business preparedness for new regulation, have been constrained by the twin uncertainties of the coronavirus and preparing for the end of the EU transition period. Reverse charge VAT would harm the industry's smallest firms, and at the worst possible time."

Notes to editors

The Federation of Master Builders (FMB) is the largest trade association in the UK construction industry representing thousands of firms in England, Scotland, Wales and Northern Ireland. Established in 1941 to protect the interests of small and medium-sized (SME) construction firms, the FMB is independent and non-profit making, lobbying for members’ interests at both the national and local level.

The FMB is a source of knowledge, professional advice and support for its members, providing a range of modern and relevant business building services to help them succeed. The FMB is committed to raising quality in the construction industry and offers a free Find a Builder service to consumers.