MPs have called for an end to “unfair pavement tax” which sees electric vehicle owners paying £227 more to charge their car than drivers with driveways.
This is because higher VAT is levied on public charge points compared to home chargers.
Vicky Ford MP: “It is deeply unfair that those people with driveways pay only 5% VAT on the electricity to charge their cars but those in terraced homes often have to pay 20% to use a commercial charger, especially as those in terraced homes are often on lower incomes.
“Uptake of electric vehicles has never been higher, the second hand market is beginning to thrive and more and more people are looking to switch to electric cars.
“The Chancellor could use the Budget with a targeted intervention to stop the pavement tax, support shared chargers in residential areas, level out this inequality and help the industry to grow.”
The Conservative Environment Network (CEN) said it is important that all households have access to affordable charging with around 10 million electric vehicles expected to be on the road by 2030.
MPs hope Chancellor Jeremy Hunt will announce fresh measures at Wednesday’s budget.
Stephen Hammond MP: “Going into this budget, the government is right to prioritise cutting taxes and letting people keep more of their hard-earned money.
“With limited headroom, the Chancellor should focus tax cuts on supporting hard-working people who are struggling with the cost of living.
“The government should look to end the unfair pavement tax for EV charge points, by cutting the VAT rate for public charge points to 5%.
“It would ensure that households without a driveway, often on lower incomes, are not paying more tax to charge their cars than those with private driveways who only pay 5% VAT.
“This would instantly put £227 per year back in people’s pockets and help more people afford to run an electric car.”
Sam Payne, climate programme manager at CEN, said it was right to introduce a Zero Emission Vehicle mandate, which will grow the supply of EVs on the market.
“Unfortunately, for the 30% of households without a driveway, they currently pay up to £227 a year more than those with a driveway, due to the higher VAT rate that is levied on public charge points compared to home chargers.
“To ensure every household is able to charge their car at a fair price, the government should cut the VAT rate on public charge points from 20% to 5% to match domestic charging. This will encourage more households to go electric and ensure fairness is at the heart of the transition.”
