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Peter Luff, MP for Mid Worcestershire, has expressed his relief that a fair way forward has been found to help local congregations meet the VAT bill on alterations to their churches.
The decision to impose VAT on alterations to listed buildings, announced in this year’s Budget, had brought considerable concern from communities across the country. It meant that churches and cathedrals making alterations, or build kitchen and toilet facilities would also have to find 20% VAT. Currently only repairs attract VAT. Peter said,

“Many of my constituents have been in touch with about this. I think Worcestershire had a particular reason to feel strongly about this, given the number of beautiful listed places of worship we have in this county.”

The Church of England calculated that this would have cost churches some £20 million a year in extra VAT payments.

Peter had written to the Chancellor of the Exchequer urging that a way of relieving the burden should be found. In the letter Peter said,

“You probably know the Church of England is responsible for 45% of all Grade 1 listed buildings in the country and often these need alterations to make them more accessible by providing toilet or kitchen facilities or disabled access. The Church does have a particular responsibility for the maintenance of listed buildings and it does seem a little harsh so dramatically to increase their burden in caring for the national heritage.”

Through the Listed Places of Worship Grant Scheme, churches and cathedrals could already claim back much of the cost of VAT on repairs. This week it has been confirmed that Chancellor of the Exchequer has been able to reach a compromise and has decided both to extend the Listed Places of Worship Grant Scheme to cover alterations and to increase the amount available to it by £30 million a year.

On top of the £12 million already made available to the Listed Places of Worship Grant Scheme, this makes a total of £42 million a year.

The Bishop of London has said that,

“...we are delighted that the £30 million a year extra money that the Chancellor has committed to the Listed Places of Worship Grant Scheme...will enable the equivalent to the VAT Bill to be paid out on all alterations and repairs to listed Church buildings.”

Peter commented,

“I am really pleased that the Government has been able to find a sensible solution to this issue. It’s right that millionaires who want to put swimming pools in their listed properties should pay VAT. But it wasn’t right that hard-pressed church congregations should be penalised for doing the right thing.

“This significantly increased grant should ensure that churches of all denominations aren’t deterred from making important alterations to listed buildings because of the VAT bill. This will help keep a vital part of the nation’s heritage accessible and well maintained.”


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