Building Safety Levy is an anti-growth policy
The government has released its response to the Building Safety Levy (BSL) consultation, confirming the taxation levels it seeks to impose across the development industry.
Richard Beresford, chief executive of the National Federation of Builders, said: “The Building Safety Levy is anti-growth, anti-SME policy, which will weaken the housebuilding industry and put the government’s 1.5 million home promise in further jeopardy. It rejects the polluter pays principle, targeting innocent housebuilders, and risking unintended consequences, such as shrinking the size of new build homes.
The industry already knew that the Conservative government had chosen to tax innocent housebuilders while letting guilty parties off the hook. We had hoped that Labour, the government of growth, would reject such a bad policy that hinders industry growth, but instead it chose proportionate unfairness.”
The BSL will come into force in Autumn 2026 with levy rates charged per square-metre of chargeable floorspace for works on non-previously developed land (PDL) and works on previously developed land. PDL rates are discounted by 50%.
Rates are highest in areas with the most expensive housing and lowest in the least expensive.
Several BSL exemptions will be in place, including for government funded projects and sites of fewer than ten homes.
Rico Wojtulewicz, head of policy and market insight at the NFB and House Builders Association (HBA), commented: “Small builders came to the government with a solution that shared remediation costs across all accountable industries, as well as delivered a ‘polluters should pay more’ principle. It is devastating news that a fairer form of unfairness has been rejected.
Our solution would raise funds more quickly, therefore freeing leaseholders of their nightmare. Would not disproportionately target innocent builders and building companies yet to be created. Ensured that SMEs, who train 73% of our apprentices, offer the most secure employment, who were not involved in various industry scandals, and who build the social and affordable housing the Government is basing its reputation on, were not being targeted for the sake of political expedience.”
The NFB’s ‘Polluter Pays Building Safety Levy’ call to action letter, which developers can use to send to their MPs to lobby for a fairer approach, can be found here: https://ask-nfb.builders.org.uk/documents/template-lobbying-letter-polluter-pays-building-safety-levy/