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/ 26 March 2012

Statement on Budget 2012

Unexpectedly the Chancellor announced in the Budget that approved alterations to listed buildings – which, unlike repairs and maintenance are currently zero-rated – will be charged at the standard rate of 20 percent. This will cost Church of England congregations up to £20 million per annum on works to its 12,500 listed church buildings, assuming of course parishes and cathedrals can now afford to go ahead and undertake the works required.

This is a real blow to communities who are seeking to maintain and develop their churches (including improved lavatory, kitchen, disability and energy saving facilities) to enable churches to be more widely used by the community. The 20 percent VAT charge will also negatively impact bell hanging and organ building, both traditional craft industries, where some schemes currently enjoy zero rating.

The day after the Budget the Bishop of London and Second Church Estates Commissioner wrote to the Chancellor asking him to keep alterations to listed churches zero-rated.

The accompanying Treasury Document also stated that the Government was ‘extending’ the scope of the Grant Scheme administered by the Department of Culture, Media and Sport to include alterations. It did not; however specify any increase in funding of the scheme. Without a cash increase to the Listed Places of Worship Grant Scheme, which is already inadequate to cover all repair claims, the current scheme will simply be divided into even smaller amounts among a larger group of claimants. So, far from being additional help for churches, the effect of the extension will be to reduce the proportion of the VAT costs refunded for repairs and maintenance.

Further action: please contact your local MP with examples of how this extra 20 percent charge will impact on your communities and fundraising. You may like to send this information also to your DAC.

The Government’s consultation document can be downloaded from here (pdf).

The budget document can be downloaded here. The relevant part is Chapter 2 para 179.

Letters have been sent to the Chancellor from:

The Bishop of London, Chair of the Cathedral and Church Buildings Division.

Tony Baldry MP, the Second Church Estates Commissioner.

Update: petition to bring back zero rate VAT on alterations to listed churches

The Church of England has created an e-petition calling on the Chancellor to bring back zero rate VAT to alterations to the CofE’s 12,500 listed churches.

The e-petition can be signed online now at http://epetitions.direct.gov.uk/petitions/32229.

FOUND UNDER : News, Parish Property Support

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The diocesan communications team provides support to the network of clergy, churches, parishes and other worshipping communities that comprises the Diocese of London, as well as to the staff teams of the London Diocesan Fund.

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