§ Claire WardTo ask the Chancellor of the Exchequer what plans he has to reduce VAT on devices which improve safety in the home. [171886]
§ John HealeyMember states are permitted only to introduce reduced rates of VAT from the prescribed list of goods and services as set out in Annex H of the EC Sixth VAT Directive. There is no general provision in Annex H for devices which improve safety in the home.
But Annex H does allow a reduced rate for certain works to housing and the Government have used this to introduce a reduced rate of VAT for the grant-funded installation of certain security measures (for example window and door-locks and smoke alarms), when installed at the same time as energy saving materials or central heating systems also paid for by a qualifying grant. Qualifying grants are targeted at people aged 60 or over and those receiving specified benefits, so the related reduced rate is similarly well targeted at those who need help most.
482WThe UK's existing zero rates also cover a number of measures that contribute to safety in the home, such as burglar alarms and security lights, but only if they are installed in new homes at the time of construction.
A review of the reduced rate provisions is currently under way in Europe and the Government have made clear in these negotiations that we will not agree to the removal of any of our zero and reduced rate VAT derogations.