§ Mr. John Fraserasked the Secretary of State for the Environment if he will estimate the increase in the cost of home improvement and repair grants in consequence of the proposals to impose value added tax on building operations currently exempted from value added tax.
§ Sir George YoungIt is not possible to provide a reliable estimate in the form requested by the hon. Member. VAT is already payable on housing repair works and the measures proposed in my right hon. Friend the Chancellor of the Exchequer's Budget statement will therefore have no effect on the cost of works included in repairs grant applications, or on the cost of repair works which form part of grant-aided improvements.
The effect for the grant system of the changes in VAT requirements will depend on the rate at which local authorities provide discretionary improvement grants and the nature of the works approved.