Scottish Catholic Observer

Chancellor George Osborne has announced a £30 million package to help churches hit by the planned imposition of VAT on alterations to historic buildings.

Mr Osbourne (above) said the money in a grant to the Listed Places of Worship scheme which would be ‘100 per cent compensation’ for places of worship hit by the so-called ‘church tax’ in the Budget.

From October this year the Treasury will charge VAT at 20 per cent on approved alterations to listed buildings, work which is currently exempt from the tax. When this was announced Archbishop Vincent Nichols of Westminster, president of the Bishops’ Conference of England and Wales England, said the move was ‘regrettable.’

Mr Osborne made the announcement of aid to churches to MPs in Parliament yesterday, saying he had had discussions with the Anglican Bishop of London Richard Chartres on the issue.

“The Government will provide £30 million of grant to the Listed Places of Worship scheme,” Mr Osborne said. “That will be 100 per cent compensation, exactly as we promised in the Budget, for the additional cost borne by churches for alterations and should also go a long way to helping the situation with repairs and maintenance where in recent years they have not been able to get 100 per cent compensation for those repairs and maintenance. We think it will deliver 10 per cent coverage for repairs and maintenance as well.”

Labour MP Frank Field, chairman of the planning authority for English cathedrals, welcomed the move.

“Can I congratulate you on the way you have dug yourself out of a hole into which you placed yourself,” Mr Field told Mr Osborne.

The Listed Places of Worship Grant Scheme (LPWGS) will enable the equivalent to the VAT bill to be paid out on all alterations and repairs to listed church buildings.

The Church of England welcomed the agreement with the Government over the future funding of alterations and repairs to its 12,500 listed buildings. However the wife of the Dean of Wakefield said today that the Government package for churches does not go far enough.