Job losses are predicted to hit 300,000 in the construction industry but experiments elsewhere in Europe indicate a VAT cut could create thousands of much needed jobs.
Michael Ankers Chief Executive of the CPA said: "The Chancellor has a unique opportunity in his Budget to take advantage of the EU decision of 10 March 2009, which allows Member States to reduce VAT on services, and cut the current rate of VAT from 15 to 5% for all private housing repair and maintenance work. This will provide a far more effective fiscal stimulus than many of the other measures the Government has introduced or is considering, by helping to sustain employment in many thousands of SMEs and using construction products, of which a high proportion are manufactured in the UK."
Louis Armstrong Chief Executive of the RICS said: "Making it cheaper to repair and maintain homes will help bring empty properties back into use and encourage people to take advantage of energy-saving measures such as insulation. Reusing empty homes improves communities, minimises waste sent to landfill and reduces carbon emissions from the transport of construction materials.
"Cutting VAT would help bring empty homes back into use and increase supply while housebuilding is at a record low level."
Richard Diment, Director General of the FMB said: "Recycling our heritage by putting buildings back into beneficial use is an essential part of improving our quality of life. Research carried out by University of Oxford calculates that the potential market for the refurbishment of existing homes to improve their energy efficiency is worth between £3.5 and £6.5billion, which would be a significant boost to the construction sector providing thousands of new jobs at a time when they are needed more than ever."
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