The National Churches Trust (NCT) has said that many churches are facing financial hardship because of the Starmer government’s decision to chop funding for historic places of worship and take away a VAT exemption that goes back to Gordon Brown’s time as Chancellor.
The Listed Places of Worship Grant Scheme was first established in 2001 and gave historic churches and exemption from paying VAT on repairs. Initially intended as an interim measure, the scheme has essentially been renewed by every government since then – until now.
The scheme is on account of come to an end on 31 March, nonetheless the NCT said that churches are already feeling the pinch since the budget has now run out.
The scheme’s budget was previously set at £42 million, nonetheless this was almost halved by Starmer’s government to £23 million, all of which has now been used up.
The Listed Places of Worship Grant Scheme is about to get replaced by the Places of Worship Renewal Fund. When the brand new scheme was announced the Church of England welcomed the clarity of what would replace the old scheme, but warned the changes could mean “added pressure on local fundraisers and inevitably a drain on other sources of funding”.
The NCT has said that with the brand new scheme not yet up and running, many churches don’t know what support they will reasonably expect to receive from the federal government.
The group added its concerns that the brand new scheme will operate at the identical reduced budget because the old one and can also be subject to tax.
Sir Philip Rutnam, Chair of the NCT, said the cash running out within the Listed Places of Worship Grant Scheme before the scheme is about to finish “leaves potentially tons of of churches within the lurch”.
“Today, 21,000 historic places of worship, the overwhelming majority churches, will start bearing the price of latest taxes,” he said.
“After 25 successful years, the federal government has removed a lifeline for churches which was introduced by a Labour Chancellor in 2001, allowing them to reclaim VAT on repairs.
“With 1000s of churches in danger, that is yet one more blow to our national heritage as many will now be unable to pay for urgent repairs.”
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