The Future of Historic Church Funding: VAT Changes Stir Controversy
(Photo: National Churches Trust)
The National Churches Trust (NCT) is appealing to the government to revisit its decision to scrap a VAT exemption for historic churches undergoing repairs. This exemption has been a financial lifeline since its introduction by former Chancellor Gordon Brown under the Listed Places of Worship Grant Scheme (LPWGS).
The Starmer administration’s recent move to significantly reduce the scheme’s budget and replace it with a new Places of Worship Renewal Fund, now open for submissions, has sparked concerns. Although the NCT appreciates the continued support for historical churches, it insists that the removal of the VAT exemption deserves further evaluation.
“It is unfair that museums and galleries with free admission pay no VAT on their buildings, but churches must now pay the full 20%, even though they provide essential services to their local communities and collectively house collections far larger than any museum,” the NCT remarked. Additionally, they highlighted the absurdity of it costing nothing to demolish a listed church, while maintaining one incurs a 20% charge for local communities.
Beyond VAT, the NCT has voiced several concerns regarding the new fund. Unlike the LPWGS, which was nationwide, the new scheme is limited to English churches due to heritage being a devolved matter. There’s also anxiety that priority may be given to larger congregations seeking quick repairs, potentially sidelining smaller or more remote churches in need of extensive renovations.
This decision to maintain VAT on historic churches mirrors Labour’s previous choice regarding private school fees. Estimates indicate that the 20% VAT increase has led to the closure of around 100 independent schools, as middle and working-class families find the additional costs prohibitive, leaving private education primarily accessible to wealthier families.
This article was originally written by www.christiantoday.com
