In January ACRE submitted a budget representation, urging the government to pledge £3 million in the Budget to refund the VAT paid by village halls on improvement work such as modern kitchen and toilet facilities and new meeting rooms.
The cost of VAT on improvements hampers fundraising to improve these vital community buildings ACRE Chairman, David Emerson CBE, has written to the Chancellor on behalf of ACRE’s Village and Community Halls Network to reinforce the need for VAT refunds for village halls and other similar charitable community buildings such as church halls, community centres and scout huts, all of which provide essential facilities for a wide range of community groups such as pre-schools, youth clubs, WIs, lunch clubs for the elderly and sports groups.
Mr Emerson says “A closely targeted VAT refund scheme would assist volunteers running charitable village halls and similar community buildings to update and adapt older buildings to better serve their communities in the light of changes in society, such as an ageing population and increased pre-school hours.
A VAT refund scheme would achieve immediate social and economic benefits without having to wait for a review of VAT rates post Brexit. It would demonstrate that the Government intends Brexit to achieve benefits right to the grassroots of communities throughout the UK”
Mr Emerson says “A closely targeted VAT refund scheme would assist volunteers running charitable village halls and similar community buildings."
Small village hall charities are not VAT registered so they cannot reclaim the 20% VAT on building work to update older halls, which means that a £200,000 refurbishment project incurs an extra £40,000 in non-reclaimable VAT. This tax on voluntary effort is widely felt to be unfair. Charitable community buildings underpin community life, particularly in rural areas where alternative facilities such as pubs, shops and schools have closed.
VAT refund schemes now operate for search and rescue services, hospices and historic churches which pave the way for a modest refund scheme for village hall.