VAT on green windows 'unfair'

The Glass and Glazing Federation(GGF) said there is already a disparity of VAT rates for energy efficient products, with most energy efficient products at a rate of 5% VAT whilst energy efficient glazing remains at rate of 20% VAT.

Nigel Rees, GGF chief executive, has written to the Chancellor ahead of the Budget on Wednesday.

"It is completely unfair that energy efficient windows are still at a 20% rate of VAT while other energy efficient products are at 5% rate of VAT," he said.

"When you consider the amount of energy lost through inefficient windows and also the industry’s investment in technological innovations that have been created with the sole purpose of being energy efficient, there is no justification for them to be at the higher rate of VAT.

"This inequality is both a disincentive for homeowners to install energy efficient glazing and also a trading disadvantage for glass and glazing companies."

The letter was accompanied by the recent independent research report by Experian on the effects of a reduction in the rate of VAT on housing renovation and repair work.

The report sponsored by the GGF, highlights that a VAT rate reduction on all housing renovation and repairs from 20% to 5% could boost the UK economy by more than £15bn from 2015 to 2020. This reduction could also create more than 95,000 jobs and save 240,000 tonnes of CO2 from thousands of homes.

The report is also backed by more than 60 charities, trade associations, business groups and financial institutions that are united in calling on all three main political parties to commit to this VAT reduction in their 2015 General Election manifestos.