Nothing is easier than spending the public money. It does not appear to belong to anybody.
So, that nice boy George Osborne has been urged to slash the VAT rate for the building industry in today’s Budget.
That was in a story in the Independent last week. Now, obviously, the building industry has been calling for this for months, no, years. Heck, we’ve been calling for it so long that even Ed Balls has listened.
But now that Alan Pearce, VAT partner at accountants Blick Rothenberg, has spoken – an accountant, you see, someone who understands money! – the mainstream press is listening.
Pearce told the Independent: “If VAT on services such as property maintenance, repairs, refurbishment, alterations and extensions was reduced by 15 per cent, for say two years, it would give a significant boost to the building and construction industry and kick-start this sector into growth and recovery.”
And apparently, the EU would let us do this! Yes, the same EU that is stupidly taking the UK Treasury to court for charging 5% VAT on energy-saving products because “insulation isn’t on the list”, will let us to likewise for residential property – because it is on the list.
Pearce says that while the Government might lose some revenue in the short term, it would be more than made up for by getting people back to work and businesses operating at capacity, as well as going a long way towards improving our housing stock.
Well exactly. That’s EXACTLY what the building industry has been shouting about.
Pearce suggests a two year reduction, similar to the one year reduction on VAT that the previous Labour Government brought in. That, he says, would push people into getting work done within the window. True. Although it would also screw those people whose bills fall due outside of the window. But maybe that’s a problem we should just worry about when it happens.
And maybe I’m over thinking this, but I remember the deadline set by the Lawson Chancellorship in 1988 – the long notice of the removal of double MIRAS tax-relief caused normal, right-minded people to go doolally over house-prices, falling over themselves to pay over the odds just to beat the deadline. And we all know how well that ended.
I don’t know why I’m even bothering to think about this. The very fact that Labour a) thinks it’s a good idea and b) once did something similar means that there’s no way on this earth that Osborne will even consider going there.
And, I’m not really expecting much of a bunch who have just announced new measures to help with childcare costs for households which earn up to £300,000 a year, the month before they take child benefit away from anyone earning over £50,000.
Still, I’m neither an economist nor, thank the Lord, a politician, so what do I know?
Oh well, by 1.15pm or so we’ll all know what Georgie-boy has in store for us.
Mind you, I’m at the FMB’s Master Builder of the Year awards today, which should be good fun were George actually do what we’d like him to!