Isra-Mart srl:Treasury mulls Green Deal stamp duty incentives

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The government is reportedly considering lowering levels of stamp duty for energy efficient homes as part of this month's budget in a move designed to encourage take up of the coalition's flagship Green Deal energy efficiency scheme.

Construction industry magazine Building today reported that Department of Energy and Climate Change officials are privately confident the budget will propose a form of tax break for those buildings fitted with measures the Green Deal is trying to encourage, such as insulation, double glazing and efficient boilers, while potentially imposing penalties on the most inefficient homes.

The industry has long argued that generous financial incentives will be required to encourage people to take advantage of the loans offered through the Green Deal scheme if the government is to meet its goal of upgrading 14 million homes and offices in the next decade.

John Alker, director of policy and communication at trade body the UK Green Building Council (UK GBC), welcomed the mooted cuts to stamp duty, but said that as a stand alone policy it was unlikely to persuade large numbers of homeowners and businesses to take advantage of the Green Deal.

"I think it's absolutely necessary [for Green Deal take-up]. There will be quirks officials need to think through, but this is not without precedent - stamp duty is always being altered," he said. "[But] we're sceptical whether it's enough to drive take-up. It needs regulation in behind it to follow up."

Green groups have been arguing that the government should emulate the MOT requirement placed on cars and prevent the sale or lease of properties unless minimum energy efficiency standards are met.

However, climate minister Greg Barker this week signalled the government would not impose such stringent rules on the grounds it would undermine public support for green measures.

Alker countered that tighter rules governing the sale of properties would force people to take energy efficiency into consideration as part of property prices.

"In an ideal world, more energy efficient property would have a higher price anyway, and would be taken into account along with location and period features and all these things," he said. "Anything that nudges us in that direction is a good thing."

The Treasury said it does not comment on budget speculation.