To ask the Chancellor of the Exchequer if he will make it his policy to remove value added tax from insulation materials used to improve energy conservation in buildings.
§ Mr. Ryder
Zero-rating already exists for new dwellings and so insulation materials are relieved when they are installed in the course of construction by a VAT-registered builder. VAT-registered owners of new or existing commercial buildings can normally reclaim, under the normal input tax rules, any tax they are charged for insulation work or materials. Even if the cost of a general relief were acceptable in terms of revenue forgone and additional administration, any such relief would not be permissible under the EC sixth VAT directive. Thus the Government have no plans for a general relief for the insulation of existing dwellings either by contractors or on a DIY basis.