There’s a need to protect smaller developers from the Building Safety Levy, according to trade body the National Federation of Builders.
Legislation for the levy – a tax on residential buildings being used to fund the remediation of building safety defects – is expected to be published between March and April 2025 and enacted by September 2025.
Richard Beresford, chief executive of the National Federation of Builders, said: “Once again, it looks as though the government is adopting a non-polluter pays principle, and similar to Nutrient Neutrality, the actual polluters are being let off the hook.
“Worse still, the government recognises the commercial costs of another tax by exempting for profit sectors which are tied to the public sector and all social housing projects.
“It has also decided that any company, even if they have never touched a high-rise development or will become new entrants to the housing industry, should pay for the failures of others, including the governments’.”
Planning, Building and Construction Today reported that the Building Safety Levy is likely to be implemented on: Sites of 10+ homes (Major sized sites); Student Housing and HMOs, applied to developments with 30 or more bed units; and with rates calculated on floor space (m²).
Exemptions may include: Social and affordable housing; development of fewer than 10 units; care homes, NHS hospitals, armed forces accommodation; Supported housing, children’s homes, refuges; and for-profit housing built by a not-for-profit registered provider.
Rico Wojtulewicz, head of policy and market insight at the National Federation of Builders, added: “If these reports are true, this is an astounding outcome which ignores industry recommendations for the levy to only be bought in once all those responsible were in scope of the Levy.
“Excluding sites of up to fifty houses to help protect a greater number of innocent SME builders and charging a supplementary levy for a five-year period on those who are responsible for such works.
“If the BSL is introduced as rumoured, then, within just two-weeks, the government will have broken its promise of not implementing policies that inhibit growth. This policy will result in fewer affordable homes, hinder companies from growing their businesses and investing in the broader industry, and discourage new entrants from joining the housebuilding sector.”