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Victory claimed in construction VAT postponement

06 September 2019

Following the government's announcement that the planned VAT changes for the construction sector has been delayed for one year, the Federation of Master Builders (FMB) has described this as a "victory for common sense".

With the reverse charge VAT changes due to be implemented on 1 October this year, a campaign was launched to press the government to change its plans due to the level of confusion and potential damage this would do to the construction industry.

Led by the FMB, the initiative included 15 industry bodies involved in lobbying the government on the impact the changes would make.

Findings of the FMB survey in July had helped to show that nearly 70% of employers were not aware of the proposed changes and few companies were prepared to deal with these.

FMB chief executive Brian Berry described the decision to delay the change as "sensible and pragmatic" and said the changes could have proved "disastrous".

He criticised HMRC for the "poor communication and guidance" it had provided, but said it was "reassuring" that government had listened to the construction industry.

"What's required now is for the government and industry to work together to deliver a sector-wide communications campaign, which must include plain English guidance on the changes.

"We also want to work with the government to deliver workshops aimed at construction employers, held in locations across the country, to explain what's happening and why," said Mr Berry.


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