§ Mr. Laurence RobertsonTo ask the Chancellor of the Exchequer if he will make a statement on his policy on the relative VAT rates applied to(a) energy saving equipment and (b) energy used in (i) new build and (ii) the repair and conversions of existing buildings. [135402]
§ John HealeyThe installation of energy-saving materials in residential accommodation and certain charity buildings is liable to VAT at the reduced rate of 5 per cent. This helps to keep homes warm and contributes to achieving the energy saving targets we are committed to as a result of the Kyoto summit. The Government is currently negotiating hard for an amendment to the European Sixth VAT Directive which would permit the reduced VAT rating of the purchase of energy-saving materials for do-it-yourself installation.
Fuel and power used in the construction, repair and conversion of buildings is standard-rated for VAT purposes. However, since 1997 domestic fuel and power subsequently used in those buildings has only been liable to VAT at 5 per cent.