Make the Heritage Tax history
Jun 2012 14

With the recent pasty tax, caravan tax and charity tax u-turns you would think that there were no more ill-advised tax alterations set to implement from this year’s Budget. Unfortunately there is still one left: the levy of VAT on improvement, alteration and restoration works to listed buildings; aptly dubbed the ‘Heritage Tax’.

The proposal to add 20 per cent to the cost of alterations will force individuals, charities and community groups to pay tens if not hundreds of thousands of pounds extra to look after historic buildings. This will make it much harder to improve listed buildings, which a great number of people enjoy.

Worse still, the tax rise is justified on insufficient evidence and fatuous claims. According to the Government this tax rise is right because the majority of the improvement work covered by the relief is not necessary for heritage purposes. They want you to believe that this tax alteration will stop millionaires installing tax-free swimming pools in their Jacobean mansions.

However the argument that the majority of improvement, alteration and restoration works are not for heritage purposes is based on just 105 cases the Treasury studied, despite the fact there are almost 30,000 Listed Building Consent applications made during the course of a year. A closer inspection by the Listed Property Owners Club found that, of 12,049 recent applications for listed building consent from across the UK, only 34 applications were for swimming pools.

There are almost 400,000 historic buildings in this country and while some are grand Palladian mansions, there are also small country cottages or barns, which are homes, community centres and places of work for people from all income brackets. Indeed half of people who live in listed buildings are in socio-economic groups C1, C2, D and E. This won’t just hit the rich.

The Government has already conceded that this tax rise will have a negative impact on some of the nation’s finest and most treasured buildings and great numbers of people, who enjoy, rely on and care for them, by offering additional compensation to listed places of worship. But yet they offer nothing to community centres, town halls, village halls, businesses and privately owned listed buildings.

There is already evidence of projects that have been cancelled or put on hold as people worry about the cost of the additional 20 per cent. Cancelling building projects will also have a negative impact on the construction industry, at a time when weak demand in this sector is a major factor holding back wider economic recovery.

By dis-incentivising listed property owners from improving, altering or restoring their properties, there is a great risk these buildings will fall into a state of continual decline and will eventually be lost. Once they are lost, they are gone forever. This will not, as the Government would like you to believe, only affect millionaires in mansions; it will affect the very fabric of our Heritage, which is something that is treasured by the majority.

Several organisations, including the Countryside Alliance and the Federation of Master Builders signed a letter in today’s Times (£) urging the Chancellor to review the proposed implementation of the heritage tax before it is too late. If you agree with them, then you can show your support by signing this petition against VAT on alterations to listed buildings. Send the Chancellor a message that this is another ill-thought out tax rise to consider a U-turn on.

Emma is the Campaign Director of the TaxPayers’ Alliance. She leads efforts to change policy through powerful campaigns and is the voice of the TPA in the media.



  • http://twitter.com/ukgoldbug Gold Bug

      “the tax rise is justified on insufficient evidence and fatuous claims.”
    All taxes are, and they’re backed by threats and force. I tried to think of one single thing that government does that couldn’t be done better by private business and could only come up with violence to individuals and other countries. 

    • Blarg1987

      Cheaper rail fares, lower utility prices? health care?

  • Johnthomas

    Brilliant article which illustrates the nonsense of the Government’s words on policy for the historic environment being translated into action. Charities and community groups will be those that suffer the most – so much for the localism experiment!