New cladding tax set to raise £2bn over a decade

RISHI Sunak will impose a new tax designed to fix the cladding scandal in next week’s Budget.

The Chancellor will target major developers to recoup around £2billion of the cost of removing the dangerous materials from high-rise buildings. The levy is set to come into force from April 1 next year.

It is a victory for the Daily Mail End The Cladding Scandal campaign, which has demanded the firms responsible for the crisis should pay their fair share. The Residential Property Developer Tax will be imposed on UK housebuilders with annual profits of more than £25million, set at between 3 and 5 per cent on profits above this threshold.

It is expected to raise around £200million a year – amounting to £2billion over the ten years it is due to be in place. Ministers have pledged £5.1billion to end the crisis in the wake of the Grenfell Tower fire in West London, which killed 72 people in June 2017.

Hundreds of thousands of flat owners have faced bills up to £150,000 because their homes are wrapped in unsafe cladding.

Emma Byrne, from the End Our Cladding Scandal campaign, last night suggested developers should face a more punitive tax.

She said: ‘£2billion over ten years is a drop in the ocean for them... it is a simple point of fairness the Government forces them to fix the mess they have created. Since [Grenfell], seven developers have recorded combined profits of more than £15billion.’

More than 100 Scottish council high-rises still have potentially deadly cladding. Scotland is expected to get a cash windfall via the Barnett formula to spend on the issue.