Church of England Pushes for Continued Support of Tax Relief Scheme Amid Uncertainty
Historic churches across England are facing an uncertain future unless the government commits to sustaining a crucial tax relief initiative. The Church of England has urged the Labour government to ensure ongoing funding for the Listed Places of Worship Grant Scheme, vital for the upkeep of architectural treasures.
Set to expire in March 2026, the scheme allows religious sites to claim back value-added tax (VAT) on building repairs. However, recent adjustments have reduced its budget from £42 million ($55 million) to £23 million ($30 million) and capped claims at £25,000 ($32,600), according to the Culture Secretary Lisa Nandy’s January announcement.
As the custodian of nearly half of Britain’s Grade I listed buildings, the Church of England views this scheme as essential for keeping these historical sites operational. Church leaders report that the uncertainty around future funding has already hindered maintenance efforts nationwide, as noted by The Telegraph.
Archbishop of York Stephen Cottrell has directly addressed the Chancellor Rachel Reeves, emphasizing the significance of this “modest but vital investment in national heritage.” He stated, “For more than 20 years, [churches] have relied on the Listed Places of Worship Grant Scheme to give that crucial bit of extra help,” urging for its permanence and the removal of claim caps.
The absence of this scheme, Cottrell warns, would adversely impact community services offered by churches, such as food aid and winter shelters. In some regions, churches are the sole communal establishments, he added.
Rev. Marcus Walker, rector of St. Bartholomew The Great in London, highlighted the reliance on voluntary fundraising and argued against additional tax burdens. Despite the critical nature of this issue, the government has yet to decide on the scheme’s future post-March 2026.
While the Department for Culture, Media and Sport acknowledges the scheme’s importance, it has not committed to its continuance, citing alternative support sources like the National Lottery Heritage Fund.
In July, the House of Commons Culture, Media and Sport Committee advocated for making the scheme permanent, highlighting its role in preserving the U.K.’s religious heritage. Committee Chair Dame Caroline Dinenage underscored its necessity.
As reported by Church Times, the scheme has been a “lifeline” for religious buildings since 2001. Without policy changes, only about 27% of churches might remain operational within five years, the Archbishop of York warned.
During the “Great Expectations” conference in October, Cottrell expressed the churches’ anxiety over the grant’s future. He called for collaboration between the government and the Church to maintain both religious sites and their community services.
Church House data reveals over 100 Anglican churches and cathedrals are undertaking repair projects that exceed the £25,000 cap, with 38 projects valued over £2 million ($2.6 million). Many of these initiatives require reliable long-term funding.
While the government reports that 94% of past claims were under £25,000, with 70% under £5,000 ($6,500), church officials argue this overlooks the needs of numerous historic buildings needing significant repairs.
As of November 11, over £11.4 million of the £23 million budget for 2025–26 had been utilized, with around £583,000 in pending claims. About £11 million remains, as per the Department for Culture, Media and Sport’s grant tracker.
Moreover, a Savanta poll for the Church of England shows 59% of British adults support government aid for church repairs, and 77% view historic churches and cathedrals as national treasures.
This article was originally written by www.christianpost.com
