Cladding tax on new houses delayed for a 12 months | EUROtoday

Ministers have delayed a tax to fund the elimination of unsafe cladding from houses after builders warned it may hamper the federal government’s housebuilding plans.

The Ministry for Housing mentioned on Monday the Building Safety Levy can be launched from autumn 2026, relatively than this 12 months.

The tax on new houses is anticipated to boost £3.4bn to be spent on constructing security, together with efforts to take down harmful cladding.

The delay comes after builders mentioned the tax may improve constructing prices and consequence within the authorities lacking its goal to construct 1.5 million houses by 2030.

Housing Minister Matthew Pennycook instructed LBC the federal government was nonetheless dedicated to the tax and insisted the delay wouldn’t decelerate the tempo of bettering constructing security.

“The previous government left us with an unpalatable inheritance in that respect,” Pennycook mentioned.

“We’ve got to increase ther pace of works being done. Leaseholders are still trapped in these buildings.”

Neil Jefferson, chief government of the Home Builders Federation, welcomed the delay as “recognition from government that these additional costs will inevitably constrain housing supply”.

But he urged the “grossly unfair” tax on housing builders must be scrapped altogether.

He mentioned: “As proposed it will add thousands of pounds to the cost of new homes, threatening the viability of sites across swathes of the country at a time when industry is striving to reverse the decline in homebuilding numbers that we have seen in recent years.”

The tax was first introduced in 2021 by the then-Conservative authorities.

Some of the cash raised from the tax will go in the direction of the elimination of harmful cladding from buildings, following the lethal fireplace at Grenfell Tower.

Ministers have put aside £5.1bn to resolve the cladding disaster, anticipating builders, constructing house owners and social housing suppliers to pay the remaining.

Thousands of houses have been made protected, however as of December final 12 months, work had but to start out on 1 / 4 of the 1,323 tall buildings requiring consideration.

Up to 12,000 buildings and three million folks could possibly be affected.

The prolonged technique of figuring out what work must be finished and who ought to pay for it has left many residents dwelling in concern of fires or with worries over expensive restore payments.

In its basic election manifesto, Labour pledged to “take decisive action to improve building safety” and to “put a renewed focus on ensuring those responsible for the building safety crisis pay to put it right”.

Last 12 months, Deputy Prime Minister Angela Rayner mentioned the federal government was planning to introduce the Building Safety Levy in September this 12 months.

But in a letter to Raynerdozens of builders mentioned “the ability of the industry to invest in increasing the supply of new homes to meet the government’s 1.5 million target is being threatened by the imposition of new taxes”.

Housebuilders say they’re already paying £6.5bn in the direction of bettering constructing security by means of company tax and argue makers of unsafe cladding ought to bear extra of the prices.

Home Builders Federation estimates the tax may add £1,580 to the price of constructing a house and result in the lack of about 70,000 inexpensive houses over 10 years.

A Ministry for Housing, Communities and Local Government spokesperson mentioned: “This government is determined to make Britain’s homes safer by making developers pay their fair share to fix unsafe buildings through the Building Safety Levy.

“We have prolonged the timeline to offer builders extra time to issue levy prices into their plans whereas persevering with to help them to construct protected houses, and on the identical time we’re persevering with to work rapidly to repair buildings with unsafe cladding by means of our Remediation Acceleration Plan.”