Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment she has made of the potential effect of increasing VAT on new solar-battery systems by 15 per cent in October 2019 on the rate of solar battery uptake.

Changes to the VAT rules for energy-saving materials are expected to have a negligible impact on the Exchequer and on the administrative burdens on businesses. Around 1,500 future installations of solar panels, energy-saving boilers and wind turbines are expected to be affected annually, plus some other smaller scale items. This represents less than 5 per cent of the value of all installations currently eligible for the reduced rated. The remaining 95% remains unaffected.

For installations affected by the changes, the goods element of the installations will become standard rated with the labour element continuing to benefit from the reduced rate.

A Tax Information and Impact Note was published by HMRC on GOV.UK on 10 July 2019.