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VAT 'should be cut on wall insulation'

The government should cut VAT for all energy efficiency measures fitted under the Green Deal, which may include drywall insulation and underfloor heating insulation.

This is according to, which has announced its support for the measure, echoing sentiments made in a joint statement by organisations including the World Wildlife Fund, the Royal Institution of Chartered Surveyors, the UK Green Building Council and the Federation of Small Businesses.

Current VAT rates of 20 per cent ought to be reduced to five per cent, the groups asserted.

Director of consumer policy at Ann Robinson noted that the initial cost of these measures is "off-putting" for some consumers.

She claimed that the VAT reduction would reduce the cost of fitting cavity wall insulation by £50 and would trim the price of solar panels by £1,500.

"This would make larger energy efficiency measures far more appealing in the short term," the expert added.

Rising gas and electricity bills and other economic problems have resulted in Britons finding it difficult to pay for their outgoings and people are now "teetering on the edge of their finances", Ms Robinson asserted.

Statistics from indicate that more than 14 million members of the public switched their central heating off at some point last winter purely to save money, with an estimated seven million individuals expected to be in a state of fuel poverty when the latest power price increases take effect.

"The need for consumers to make their homes as energy efficient as possible has never been greater," Ms Robinson declared.

In the joint statement issued to the government, the diverse range of organisations argued that cutting VAT would stimulate demand in upgrades such as thermal insulation and the government ought to adopt "a 'whole house' approach" to all sustainabile upgrades.

Whether or not the Green Deal results in a boost to the nation's fiscal situation and takes tens of thousands of people out of joblessness and into employment in the eco-friendly economy "depends entirely on consumer take-up", the letter noted.

Posted by Helen Hughes