As a business owner you may already be aware that VAT has been reduced to 5 percent already in some fields of business in the UK. The Government, in fact, has been gradually reducing the rate from 1998 onwards until it reached 5 per cent for installation by professional installers of some energy-saving materials. Insulation installation also benefitted from this break. This VAT rate reduction reveals an appreciation of the incentivizing powers of this option. Homeowners, however, remain excluded from the benefits enjoyed by professional installers, should they opt to do the installation work on their own. The environmental benefits of the UK government reducing VAT on all insulation work to five percent would also benefit excluded classes, including homeowners.
In this era of rising bankruptcy and limited income, homeowners are more likely to opt for the do it yourself path. Homeowners would also benefit from tax breaks to support their investments in their housing. The Construction Products Association has understanding demonstrated its support for the extension of a lower VAT rate for such work
One can point out the thermal insulation market has been growing due to favorable regulation and rising energy prices. In 2007, the thermal insulation market in Europe was a 30 billion Euro market. A reduced rate of VAT on thermal insulation would enhance the demand for such products. The possible impact is illustrated by the results of a temporary campaign mimicking VAT exemption, which led to an increase in sales by 120 percent. The reduced rate of VAT, could lead tones of CO2 reduction per year. A study commissioned by the EU commission has stated that a reduced VAT rate for thermal insulation is a potentially effective instrument.
The Construction Products Association has stated that many householders are capable of installing insulation themselves and yet they are paying the full rate of VAT on a product the Government must want to encourage them to buy. It is known that buildings are the largest single energy-using sector, accounting for 40 percent of energy consumption in Europe. Insulation is a highly cost-effective end-useful measure in reducing the emissions of green house gas emissions.
As noted by those who have studied this subject, a reduced VAT rate on insulation products is not necessarily passed on by professional installers to their client. This cannot be ruled out as the reason the UK market has shown relatively low consumption. But, when the installer is the one who will live in the dwelling this will not be a discouraging factor.
The experiment of the Isle of Man of a rate reduction, which led to increased revenue from taxation shows the economic gains that are a potential ignored by the UK government. The improvement in the stock of existing housing and a reduced push on development of green field location reveal the ancillary beneficial results. The UK government should learn from the example set by the Isle of Man Government. A change in current Government policy would demonstrate the Government would like consumers to participate in doing what they can to aid the environment. It can also point out the economic gains to be had by taking this path to prod them in this direction. Meanwhile, the Government should keep in mind the message of that report about peak oil and how this rate reduction would encourage people towards changing their consumption habits.
In this era of rising bankruptcy and limited income, homeowners are more likely to opt for the do it yourself path. Homeowners would also benefit from tax breaks to support their investments in their housing. The Construction Products Association has understanding demonstrated its support for the extension of a lower VAT rate for such work
One can point out the thermal insulation market has been growing due to favorable regulation and rising energy prices. In 2007, the thermal insulation market in Europe was a 30 billion Euro market. A reduced rate of VAT on thermal insulation would enhance the demand for such products. The possible impact is illustrated by the results of a temporary campaign mimicking VAT exemption, which led to an increase in sales by 120 percent. The reduced rate of VAT, could lead tones of CO2 reduction per year. A study commissioned by the EU commission has stated that a reduced VAT rate for thermal insulation is a potentially effective instrument.
The Construction Products Association has stated that many householders are capable of installing insulation themselves and yet they are paying the full rate of VAT on a product the Government must want to encourage them to buy. It is known that buildings are the largest single energy-using sector, accounting for 40 percent of energy consumption in Europe. Insulation is a highly cost-effective end-useful measure in reducing the emissions of green house gas emissions.
As noted by those who have studied this subject, a reduced VAT rate on insulation products is not necessarily passed on by professional installers to their client. This cannot be ruled out as the reason the UK market has shown relatively low consumption. But, when the installer is the one who will live in the dwelling this will not be a discouraging factor.
The experiment of the Isle of Man of a rate reduction, which led to increased revenue from taxation shows the economic gains that are a potential ignored by the UK government. The improvement in the stock of existing housing and a reduced push on development of green field location reveal the ancillary beneficial results. The UK government should learn from the example set by the Isle of Man Government. A change in current Government policy would demonstrate the Government would like consumers to participate in doing what they can to aid the environment. It can also point out the economic gains to be had by taking this path to prod them in this direction. Meanwhile, the Government should keep in mind the message of that report about peak oil and how this rate reduction would encourage people towards changing their consumption habits.
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