Move to reduce VAT on property modernisation
Prescott urges Brown to reduce VAT on modernisation of properties by developers.
John Prescott is urging the chancellor to harmonise tax rates on new and developed properties in his budget next week in an attempt to encourage big urban renovation programmes.
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According to reports in The Guardian, the deputy prime minister is pushing for a reduction in the VAT due when developers modernise properties. At present, a rate of 17.5 per cent is due, whereas new properties are zero-rated.
The ODPM believes that the disparity favours new building, and discourages inner-city regeneration projects.