Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if his Department will make an assessment of the potential merits of bringing the rate of VAT for public electric vehicle charging in line with the rate of charging at home.

In order to keep costs down for families, the supply of electricity for domestic use, including charging an electric vehicle (EV) at home, attracts the reduced rate of VAT (five per cent). However, electricity supplied at EV charging points in public places is subject to the standard rate of VAT (twenty per cent).

The Government has not specifically introduced a reduced rate for charging EVs at home. However, the practical challenges of differentiating between the electricity used at home for general domestic purposes, and electricity used to charge EVs currently mean that the reduced rate is effectively being applied to EV charging at home.

Introducing a VAT relief for public EV charging to match the VAT treatment of domestic fuel and power would impose additional pressure on the public finances, to which VAT makes a significant contribution. VAT is the UK’s third largest tax forecast to raise £157 billion in 2022/23, helping to fund key spending priorities such as important public services, including the NHS, education and defence.

The Government is committed to supporting the transition to zero emission vehicles to help the UK meet its net zero obligations. The Government has committed £2.5 billion since 2020 to support the transition to zero emission vehicles, which funds targeted vehicle incentives and the rollout of charging infrastructure.