(From left) Minister of Social Care, Constituency Empowerment and Urban Development, Dr Denis Lowe, Minister of Housing and Lands, Michael Lashley, and Minister of Foreign Affairs, Chris Sinckler, making their way into the House of Assembly.

THE VALUE ADDED TAX is gone from building materials used in low-income homes.

Prime Minister and Minister of Finance David Thompson, who was delivering his Financial Statement and Budgetary Proposals yesterday, said VAT had negatively impacted on the desire of Barbadians to own their own homes.

"Due to the rising cost of land and building materials, the cost of building a home is becoming prohibitive to those earning low incomes," Thompson told the House of Assembly.

"We decided to remove the VAT on building materials on low-income houses with a value of up to $150 000 for first-time home-owners who reside in their own homes," he said.

Thompson said one of the Government's concerns was policing the new regime.

To this end, the Government has decided to refund the VAT included in the cost of acquisition of built or bought owner-occupied houses.

Thompson said the removal of VAT on those items would cost the Government $7.2 million.

Family income must be below $42 000 per annum and houses must cost no more than $150 000.

The Prime Minister said contractors were being urged to register under the Housing Incentive Act, to benefit from a reduced income tax rate. (HLE)