CONSERVATORY TAX TOBE AXED

... and ministers signal retreat on charity tax relief too

Ministers are to scrap plans for a ‘conservatory tax’ following a massive tory backlash. A senior Government source told the Mail that the proposals are ‘dead in the water’.

This latest abrupt U-turn comes only a week after we revealed the move which would force homeowners to fork out hundreds of pounds extra on measures to improve energy efficiency when they build an extension or fit a boiler.

Although the Liberal Democrat-inspired plans are still out for consultation, the source said: ‘We are absolutely not going to have a conservatory tax. It is an attack on aspiration and we want nothing to do with it. It will be blocked.’

The rethink came as ministers struggled to regain control of the political agenda after an Easter break dominated by Budget rows over tax raids on charities, churches and the elderly.

These were the key developments on another tumultuous day for the Coalition:

Ministers signalled a climbdown over a planned cap on tax relief for charitable donations, as a survey showed two-thirds of Coalition MPS are against it;

Tory Party treasurer Lord Fink joined the criticism of the charity cap, warning it would slash donations to good causes;

The deans of 23 cathedrals warned that George Osborne’s plan to slap VAT on listed building alterations ‘seriously jeopardises the sustainability of our great buildings’;

Nick Clegg admitted the Government was in ‘ a rut where every potentially good story turns into a bad one’;

Senior Tory David Davis warned that the Government had made a series of ‘straightforward unforced errors’ in recent weeks;

Labour announced it is to force a Commons vote this week on the so- called ‘granny

tax’. The £3.5billion raid will hit 4.4million pensioners, with some losing up to £323 a year;

David Cameron defended himself against charges of grandstanding on the world stage after spending all of last week out of the country on a tour of the Far East.

The Mail’s revelation last Monday that ministers planned to force millions of homeowners to install costly energy efficiency measures when making home improvements infuriated Tory MPS.

Under the ‘mandatory’ scheme anyone wanting to build a conservatory, replace a broken boiler or install new windows would have to seek permission from the local authority. It could then require them to improve the energy efficiency of their homes by investing in measures such as loft and wall insulation and draught-proofing.

Loans would be available under the Government’s £14billion Green Deal scheme to help pay for the measures, the cost of which could run into hundreds of pounds. But the scheme alarmed many Conservatives, who feared it would deter families wanting to improve their homes.

MP Stewart Jackson said: ‘We should be supporting aspirational families who want to better themselves and improve their homes, not clobbering

them. It is a crackpot scheme and I hope it is strangled at birth.’

Fellow Tory Mark Pritchard said: ‘The tax on conservatories should be renamed a tax on Conservatives. It is another anti-aspiration tax, and a tax on one of the UK’S favourite hobbies – DIY.’ A powerful group of Tory ministers, including the Communities Secretary Eric Pickles, Employment Minister Chris Grayling and Housing Minister Grant Shapps, mobilised quickly to block the move.

Mr Cameron is also said to have been alarmed by the proposal. The controversial measure is included in a consultation issued by Mr Pickles’s Department for Communities and Local Government.

Sources said it had been included at the behest of former Lib Dem Energy Secretary Chris Huhne as a result of Coalition ‘horse-trading’.

Mr Huhne has since been forced to step down to fight criminal charges over allegations that he asked his former wife Vicky Pryce to take speeding points on his behalf.

A source said: ‘It is a shame that the idea ever made it into the consultation at all, but the Lib Dems got their way.’

A senior Government figure said the mandatory element of the scheme would be dropped when the final proposals are published. ‘We are not against people insulating their homes and we are not against the Green Deal, but it should not be mandatory,’ he said.

The decision to scrap the ‘conservatory tax’ before it has even got off the ground is likely to anger some Lib Dems.

A source close to the new Lib Dem Energy Secretary Ed Davey defended the proposal, saying it would save homeowners money in the long term. ‘We are just asking people to make improvements to make their homes more energy efficient – it seems to me that actually helps the homeowner,’ said the source.

‘Of all the building regulations there are, this is one of the few where the entire financial benefit accrues to the homeowner.

‘It will save them money on their fuel bills over the medium to long term.’

However, a raft of recent research has cast doubt on the level of savings claimed by the Government.

Some pilot studies have found that the cost of energy efficiency measures is far higher than the savings on bills.