The Chancellor of the Exchequer, Rachel Reeves, has outlined the Government's budget commitments, including numerous changes to tax.
The Home Builders Federation welcomes the announcement that Government will not proceed with the proposed changes to the Landfill Tax. However, the Government did caveat that the current rate is too low and they will increase the lower rate in line with the cash increase of the standard rate.
Elsewhere, the Government announced numerous changes to tax, National Insurance and business rates, as well as changes to apprenticeships to fully fund SME apprenticeships for eligible people under 25.
Alongside the Budget, the Office for Budget Responsibility (OBR) published the economic and fiscal outlook, which estimates that net additions for the United Kingdom between 2024-25 and 2029-30 will be approximately 1.49 million. Based on historic make-up of the housing market, this projects net additions for England to be 1.24 million.
Neil Jefferson, Chief Executive of the Home Builders Federation (HBF) says: “It is encouraging that the Chancellor has listened to industry concerns and chosen not to impose the 3000% increase in Landfill Tax consulted on earlier in the year, but the revised measures still represent an increase in tax on development when the economics of home building are already challenged."
"Whilst the Government’s planning reforms have been very positive, ministers need to now acknowledge the worsening viability of new housing schemes as a result of new taxes, levies and policy costs.
The Budget also represents another missed opportunity to address the lack of support for potential home buyers, which, amidst a lack of affordable mortgage lending, is suppressing demand and preventing builders from increasing housing supply.
"If Government fails to address the viability and affordability constraints, its housing ambitions will become increasingly unachievable.”