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European Union court case with UK over Green Deal tax breaks

The European Union has decided to take the UK government to court over it’s decision to offer a reduced VAT rate of 5% on the purchase of all energy saving building materials such as insulation. This was a move to support the government’s heavily backed Green Deal Initiative to kick start the retrofit of existing buildings in the UK.

The Commission claims that the UK has broken European law by reducing it 20% VAT rate to 5% and also it did not feel a reduced rate of VAT would be effective in boosting the scheme’s take-up.

Vicky Ford, Conservative MEP for the East of England has coordinated a letter to the European Unions’s energy commissioner which has urged the commission to re-examine the issue. She stated the the EU’s decision to go ahead with the case is “Unacceptable” and “MEPs are united in saying that this challenge is completely crazy”.

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