The Chancellor of the Exchequer announced in the Budget (March 2001) that he was to introduce an interim grant scheme which would return in grant aid the difference between 5% and the actual amount spent on VAT on eligible repairs and maintenance to listed places of worship. This was extended in the March 2004 Budget to cover the full amount spent on VAT for eligible works carried out on and after 1st April 2004.

The Government has made proposals to the European Commission for a reduced VAT rate of 5% for repairs and maintenance to listed places of worship. The scheme is currently due to continue until 31st March 2011 unless a permanent reduced rate is achieved earlier.

Next: The Grant Scheme