Speaking after the Government’s U-turn on charging VAT on church renovations, Caroline Flint said: 

“The 20% VAT hike on church renovations was a body blow to local churches, which undertake continual fundraising to meet repairs  to replace ageing roofs.

“The Chancellor’s U-turn will provide some relief, but only if the Government guarantee that churches can reclaim all the VAT they pay.  And it is clear that museums or heritage buildings owned by the likes of the National Trust will still face a 20% VAT bill for their repairs.

“This is just one of a number of botched tax increases that made the Budget very unfair, whilst rewarding millionaires with a bumper tax cut.  The Chancellor has got a lot of work to do to rethink this mess he has created.”

George Osborne has confirmed a £30million Budget U-turn on plans to hit churches with VAT on improvements and alterations.  after weeks of protest from church leaders and Conservative MPs, the Chancellor said he would offer 100 per cent compensation for places of worship hit by the so-called ‘heritage tax’.

Mr Osborne revealed an agreement had been reached with the Church of England to provide the money in a grant.

In his March Budget, blamed by Tory MPs for triggering a poll slump for their party, the Chancellor announced that the Treasury would charge VAT at 20 per cent on alterations to listed buildings, which are currently exempt from the tax.