To ask the Chancellor of the Exchequer, what recent discussions he has had with relevant stakeholders on tackling the discrepancy between the 5 per cent VAT incurred for home charging for electric vehicles and 20 per cent VAT for on-street electric vehicle charging.
20 October 2021
Electricity supplied at electric vehicle charging points in public places is subject to the standard rate of VAT (twenty per cent). In order to keep costs down for families, the supply of electricity for domestic use, including charging electric vehicles at home, attracts the reduced rate of VAT (five per cent).
Expanding the relief would come at a cost. VAT makes a significant contribution towards the public finances, raising around £130 billion in 2019/20, and helps fund the Government's priorities including the NHS, schools, and defence. Any loss in tax revenue would have to be balanced by a reduction in public spending, increased borrowing or increased taxation elsewhere.