Walsall is one of just eight areas across the country where more than five per cent of homes are left lying empty, a survey by the Halifax bank revealed today.The bank has now called on the Government to make tax changes to tackle the problem. It found nationally 279,281 private homes had been empty for at least six months in April 2007.

Halifax, which is part of the HBOS group, wants the Government to extend the five per cent rate of VAT for restoring an empty home to all properties vacant for more than six months, and not just those properties that have been unoccupied for more than two years.

It thinks this would provide a more level playing field between individuals and local authorities, which typically do not pay VAT on renovation work.

The VAT currently payable for renovating an empty home vacant for less than two years is 17.5 per cent. This means the average VAT payment for restoring a home is £5,234 – which is three-and-a-half times more than the payment on restoring a home vacant for more than two years, Halifax estimated.

Councillor John O’Hare, leader of Walsall Council, said today he would back a reduction in VAT. He said: “The problem with empty homes in Walsall is in the social housing sector. We are taking action and reviewing the amount of empty housing stock in the borough.

“I would certainly back a reduction in the amount of VAT charged by the Government to restore empty homes as this would certainly encourage more private house owners to take action and renovate their properties.”

The others LEAs with over five per cent of housing stock empty are Hartlepool, Alnwick, Preston, Rushmoor, Congleton, Middlesbrough and North East More.