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Property Industry Urges Budget Support for EPC Ratings

The British Property Federation (BPF) is sounding the alarm, asserting that the UK is at risk of missing its 2050 net-zero target without immediate action.

Property Industry Urges Budget Support for EPC Ratings

As part of this plea, the property industry is calling for assistance in the upcoming Budget to facilitate improvements in Energy Performance Certificate (EPC) ratings for properties.

The BPF emphasises the urgency of removing financial barriers for energy-efficiency upgrades to avoid falling short of the net-zero target. Approximately 58% of properties in England have an EPC rating of D or lower, with less than one-fifth of homeowners planning to enhance their property's energy efficiency.

Landlords, in particular, are feeling the pressure to improve EPC ratings. Proposed regulations mandate that all new UK tenancies meet an EPC rating of C by April 2025, and existing tenancies by 2028. To address these challenges, the BPF urges the Chancellor to swiftly implement measures to support the residential sector.

The BPF proposes zero-rating VAT on building repairs and maintenance of residential buildings as an incentive for essential upgrades. It argues that the current targeted VAT relief on energy-saving materials installation is ineffective, given that energy-efficiency improvements are seldom carried out in isolation. Additionally, the BPF recommends an alternative form of tax relief for capital expenditure that would provide full tax relief in one year. The organisation also suggests introducing improvement relief on business rates to prevent property owners from facing rate increases immediately after carrying out improvement works.

Melanie Leech, Chief Executive of the British Property Federation.

“The country’s homeowners and commercial property owners face a real challenge in reaching net zero targets and complying with incoming legislative changes.

“The government needs to recognise the importance of incentivising energy upgrades across both the commercial and residential property sectors in the Budget. The Chancellor has a clear opportunity to alleviate costs for households and encourage investment in measures that improve a property’s energy efficiency.”


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