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Church VAT meeting with George Osborne: The Church of England Newspaper, May 6, 2012 p 6. May 11, 2012

Posted by geoconger in Church of England, Church of England Newspaper, Development/Economics/Govt Finances, Politics.
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The Second Church Estates Commissioner and the Bishop of London have asked the Chancellor of the Exchequer, Mr. George Osborne, for a “full exemption” for churches on the government’s plans to impose VAT on church alterations.

Speaking to the House of Commons on 26 April 2012, Mr. Tony Baldry said the meeting with the chancellor had been “helpful and constructive.”

The chancellor had given a “commitment to ensuring that listed places of worship would not be adversely affected by the Budget proposal, and I am sure that he will do everything he can to deliver on that commitment,” Mr. Baldry said.

The Church Commissioners were “pushing for full exemption. The listed places of worship scheme is welcome, but it is very volatile and uncertain at the moment because people are never quite clear how much they will receive back under the scheme, he said.

Mr. Baldry and Bishop Richard Chartres “made it clear why we believed it to be in the best interests of the community to continue to exempt alterations to listed places of worship from VAT. We gave the Chancellor a full written submission” and he “undertook to consider our submission carefully and made clear the Government’s commitment to ensuring that listed places of worship are not adversely affected by the Budget proposal. I anticipate a further meeting with the Chancellor and the Exchequer Secretary in due course,” the Second Church Estates Commissioner said.

The member for Bermondsey and Old Southwark, Simon Hughes (LD) asked if Mr. Baldry would “apply pressure” on the Government so that it understands “that simply extending the scheme’s remit to give money, when the budget has been cut, does not solve the problem, unless the rules are changed.”

Mr. Baldry concurred, saying “we are keen that the Chancellor maintains the VAT exemption for church alterations is the certainty it brings. However much money is put into the listed places of worship scheme, it has its own inherent volatility and uncertainty, and no one is sure until after the event how much the refund will be. In the last quarter, for example, only just over half of the money for the listed places of worship scheme was refunded.”

The member for Congleton, Fiona Bruce (Con.) questioned the feasibility of the government’s plans. “The Treasury has said that there will be an exemption from the new rules for contracts that have already been signed, but many churches have already undertaken ongoing works. Could there be some flexibility in that respect? Secondly, if the grant scheme is to be reviewed, could it be so over a period of several years, not just one or two years, so that there can be certainty? Works often take many years.”

Mr. Baldry stated that he agreed that it was “important to get the transitional relief right. We made it clear” to Mr. Osborne “that if he was not minded to follow us on continuing the exemption, but wanted to increase the grant under the listed places of worship scheme, we would want to see certainty over the sum, not just for this year but for a whole number of years to come.”

First printed in The Church of England Newspaper.

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