Oliver Letwin rules out change in VAT policy, the Times reports
Cabinet minister Oliver Letwin has formally opposed the European Commission鈥檚 plan to force the UK to increase the rate of VAT for energy efficiency products.
Many energy efficiency products in the UK are currently charged at a lower VAT rate of 5%, but the European Commission told the UK government - - that this lower rate contravenes EU law and they should be taxed at the standard 20% rate.
The change would add significant costs to retrofit projects conducted under the Green Deal scheme, which the construction industry fears could undermine the scheme from the outset.
The Times reports this morning that Letwin has written to the European Commission formally ruling out any change in policy, paving the way for a potential court battle between the UK and EU in the European Court of Justice in Luxembourg.
the European Commission published a consultation that appeared to endorse principles behind the UK鈥檚 current VAT system - hinting at a climbdown in its position on the UK鈥檚 lower VAT rates.
黑洞社区 revealed in August that in a letter signed by the heads of 18 industry organisations including Federation of Master Builders鈥� chief executive Brian Berry.
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