Boiler Guide has added its weight behind an industry campaign for VAT on boilers to be reduced to 5%. Whilst professionally installed heating controls, insulation, solar panels and heat pumps are currently all taxed at the reduced VAT rate of 5%, boilers continue to be taxed at the higher rate of 20%.
The campaign calls for a reduction on VAT, at least until the Government’s introduction of their Green Deal, which is due to be implemented in late 2012. It is hoped such an introduction will help stem the current decline in the heating industry, prompted by the recent increase in VAT and economic cutbacks. It was Peter Thom, the managing director of Green Heat, who started the campaign by initially lobbying parliament to reduce the VAT.
With the heating industry in decline, the ‘Cut the VAT’ campaign hopes that a reduction will not only increase consumer spending confidence, but encourage more people to replace their old and inefficient boiler system.
A reduction in VAT would be beneficial on a variety of fronts, and would:
• increase consumer confidence and spending
• encourage people to replace old inefficient boilers
• ease the burden on households through lower bills
• give a much needed boost to the heating industry
• help reduce carbon emissions
By implementing a reduction in VAT on a new boiler, the Government would most certainly see almost immediate effects. Gas consumption and carbon emissions will fall and householders will benefit from smaller bills. Not only that, jobs in the heating industry would be preserved and it could also boost UK manufacturing, as the majority of domestic boilers sold here are also made in the UK.
David Holmes, Founder of Boiler Guide, says: “A reduction on VAT on boilers to 5% would provide a welcome boost to the industry. As inflation continues to rise, combined with ongoing global uncertainty about energy prices, by helping to increase consumer spending confidence and encouraging people to invest in boiler replacement, it will benefit households in terms of reduced fuel bills.”
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