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Energy Efficiency

Volume 481: debated on Monday 20 October 2008

The Petition of Andy Jones and concerned residents,

Declares that substantial energy savings, and consequential environmental benefits, can be achieved by the use of high technology, generic, double glazing and other energy efficiency products and components and that the Government should therefore reduce VAT on such technically advanced products.

The Petitioners therefore request that the House of Commons urges the Government to reduce VAT to 5% on products and components that will make a significant contribution to improving energy efficiency.

And the Petitioners remain, etc.—[Presented by Bob Spink, Official Report, 7 October 2008; Vol. 480, c. 249.]

[P000271]

Observations from the Chancellor of the Exchequer:

The Government notes the petition, and makes the following observations:

The Government recognises the energy savings and environmental benefits that can be achieved by the use of energy-efficient products and energy-saving materials, and has introduced various measures in their support, including the CERT (Carbon Emissions Reduction Target), the Landlords Energy Saving Allowance and updated building regulations. The availability of VAT reduced rates is governed by the European VAT agreements signed by successive governments, which do not currently permit a reduced VAT rate to be applied to the sale of these products. However, these agreements have allowed the Government to introduce a reduced rate of VAT for the domestic installation of certain energy-saving materials, such as insulation and draught stripping. Furthermore, the Government is actively making the case at EU level for more widespread application of reduced VAT rates to energy-saving materials and energy-efficient products.