It is believed by some VAT experts that the construction industry could be boosted by allowing VAT to be reclaimed on home improvement projects.
It has been suggested that the existing VAT DIY scheme, which applies to the building of new houses and conversions, should be extended to cover most home improvements.
The extension of the VAT scheme and taking advantage of the reduced and zero rates for some building works would help stimulate smaller or sole trader construction businesses.
The call made by some VAT experts has been backed in Scotland by the Scottish Building Federation chief executive Michael Levack. Mr. Levack has said that the organisation would like to see reductions in the VAT rate for building works.