June 10, 2012 19:00 ET

Safeguard Welcomes Government's Plans to Reduce VAT on Caravan Holiday Homes

MANCHESTER, UNITED KINGDOM--(Marketwire - June 10, 2012) - Safeguard, one of the UK's leading providers of caravan and motorhome insurance, has welcomed today's news that the Government has scrapped its plans to levy 20% VAT on caravan holiday homes including static caravans, and instead will charge a much lower VAT rate at only 5% from April 2013.

The plans which will be delayed from October 2012 to April 2013, are being welcomed by caravan enthusiasts with open arms following a fight to halt the increase.

The National Caravan Council (NCC), British Holiday and Home Parks Association (BH&HPA) as well as a number of MPs from East Yorkshire where 95% of the UK's caravan holiday homes are manufactured, have been lobbying against the 20% tax charge with fears it will have a detrimental effect on the static caravan and holiday home industry.

Caravan holiday homes have previously been stuck in a 'tax loophole', meaning the 'shell' of the caravan has been 0 per cent tax rated for many years. The new plans announced today, will add approximately £1,500 on to the price of a typical new £30,000 static caravan, which is significantly lower than the £6,000 that would have been added if the Government stuck to its original plans of charging 20% VAT.

Since the start of the recession, sales of caravan holiday homes have been decreasing. The National Caravan Council expressed concerns that the 20% increase would bring sales of caravans to an all time low, and result in an estimated 1,000 job cuts in the caravan manufacturing industry. Not only that, a further 4,000 job cuts within the holiday park industry was also estimated as the 20% VAT rise was expected to create a damaging ripple effect across the whole of the caravan holiday home industry.

Andy Leech, Head of Safeguard Caravan Insurance said. "Whilst this 5% VAT charge is still going to increase costs for all those involved in the caravan industry, it's unlikely to have as great an impact as the initial 20% tax proposed by the Government. We're glad that the Government has listened to the lobbying groups, and seen that such a steep increase could have had a damaging effect on an industry that has already been hit by the recession."

This news release is for general information only and is not intended to be specific guidance. We shall not be liable for any loss or damage caused by or in connection with use of or reliance on any content of this news release.

For more information please contact Geraldine Vesey, Mairead Rodden or Lucy Gordon at SKV Communications on 0161 838 7770 or email

Notes to Editors

  • Safeguard is the specialist Caravan and Motorhome division of Swinton Group Limited.
  • Safeguard has over 25 years specialist insurance experience and was recently voted 'Insurer of the Year' by one of the most popular motorhome magazines
  • With 553 branches nationwide Swinton is the largest high street insurance retailer
  • Safeguard has an award winning website

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