The Environmental Industries Commission (EIC) has called for VAT to be scrapped on green building retrofits.
The call to scrap VAT on green building retrofits is part of a series of proposals to embed circular economy principles into the construction of new homes, and transport and energy projects.
The proposals are in a new EIC paper which has been published ahead of the UK Government’s Circular Economy Strategy, which is expected this autumn.
The Strategy will target six sectors – textiles, transport, construction, agri-food, chemicals and plastics – to cut waste and drive reuse.
By rethinking how we design, build and reuse, the UK can unlock new markets, create jobs and deliver resilient communities.
Commenting on the paper, Kate Jennings, CEO of the Environmental Industries Commission, said: “The circular economy is not just an environmental fix – it is a growth strategy that can cut waste, boost productivity and future-proof UK infrastructure.
“By rethinking how we design, build and reuse, the UK can unlock new markets, create jobs and deliver resilient communities.”
The EIC’s paper recommends that the UK Government scrap VAT on retrofitting to encourage reuse over demolition.
The other recommendations include:
- Embed whole-life value in public procurement.
- Pilot carbon and circularity assessments on infrastructure projects.
- Incentivise energy recovery and make landfill a last resort.
Philippa Spence, Managing Director of Ramboll and Chair of the EIC, commented: “The UK cannot meet its growth or climate goals without systemic change in how we deliver infrastructure. Circularity is the bridge between environmental necessity and economic opportunity.”