Mooted VAT Cut for Public EV Charging – Brilliant News for UK Drivers
Bottom line: The UK government may drop the VAT on public EV charging from 20% to 5%, a move hailed as a huge win for drivers who can’t charge at home.
Mooted VAT Cut for Public EV Charging – Brilliant News for UK Drivers
Image: Mooted VAT Cut for Public EV Charging – Brilliant News for UK Drivers – Performance Comparison and Specifications
Policy Overview
The Treasury is reacting to criticism over the upcoming pay‑per‑mile eVED tax that kicks in on 1 April 2028. Analysts at the OBR say the tax could cut EV sales by about 440,000 units between 2025 and 2031. To soften the blow, chancellor Rachel Reeves is said to be preparing a VAT reduction on public chargers and lower network fees.
Impact on Charging Costs
Today, a driver using a public charger pays roughly 54p per kWh, while a home wallbox costs around 8p per kWh. Reducing VAT to 5%—the same rate applied to household electricity—could bring public prices much closer to home rates, making EVs truly affordable for the 35% of Britons without a driveway or off‑street parking.
- Potential savings of up to 15p per kWh for public users.
- Greater parity encourages more people to consider an EV.
- Helps meet the government target of 80% new‑car sales being electric by 2030.
Market Implications
Polestar UK boss Matt Galvin called the proposal “brilliant, brilliant news” for those who can’t charge at home. He also urged the government to scrap congestion charges for EVs and extend the Electric Car Grant to used vehicles, arguing that mixed messages are confusing potential buyers.
Industry experts say clear, consistent incentives are essential. If public charging becomes cheap enough, it could offset the deterrent effect of eVED and keep the UK on track for its EV ambitions.
| Engine | Mileage | Price | Top Features |
|---|---|---|---|
| N/A (public charging service) | N/A | VAT 5% (proposed) | Lower network fees, parity with home electricity rates, supports EV adoption |
FAQ
- What is the proposed VAT rate for public EV charging? The plan is to cut VAT from the current 20% to 5%.
- How will the VAT cut affect the cost per kWh? It could reduce the price by roughly 15p per kWh, bringing public rates much closer to the 8p/kWh typical for home charging.
- Will the VAT cut help meet the 2030 EV target? Yes, cheaper public charging is seen as key to reaching the goal of 80% new‑car sales being electric.
What do you think about the VAT cut? Share your thoughts in the comments below.
Source: Read Official News
