Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of introducing a VAT exemption for building materials used in remediation works on buildings identified as having fire safety defects; and if he will make a statement.

Under the current VAT rules, replacement cladding may qualify for a zero rate when the replacement cladding forms part of the original construction and the person requesting the replacement cladding is either the owner, developer or contractor during the original construction works. Otherwise, remediation work falls under repair and maintenance and attracts the standard rate of VAT.

The Government announced on 10 February 2021 that it would fully fund the cost of replacing unsafe cladding for all leaseholders in residential buildings 18 metres and over in England. It was also announced that for low rise buildings between 11 metres and 18 metres, with a lower risk to safety, there will be new protection from the costs of cladding removal.