The framework of VAT rates is set by the EU. There are a number of areas in which member states are allowed (but not obliged) to set reduced VAT rates (of 5% or more). The EU wishes to rationalise this, and a consultation suggests reduced rates for work to private dwellings. The CLA response supports this and also proposes its extension to non-residential listed buildings. If either or both were permitted by the EU, the CLA and others would then seek to persuade the UK government to set reduced rates in the UK.
EU Consultation on Reduced Rates of VAT