Chancellor urged to cut VAT on public charging of electric cars

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Electric vehicle (EV) chargepoint operators have urged the Chancellor to deduct VAT on public charges.

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The owners of 23 companies signed a letter urging Quasi Quarteng to undertake a “simple, relatively low-cost intervention” as a rise in electricity prices “threatens the willingness of consumers to switch to EVs”.

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Drivers who can’t charge at home because they don’t have off-street parking pay four times as much tax for electricity when using public chargepoints.

Such reduction will immediately bring down the prices.

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VAT on domestic electricity is 5% while motorists using on-street chargers pay 20%.

The letter, coordinated by EV campaign group Faircharge, was signed by Chargepoint operators such as Ionity, Instavolt and Osprey ahead of Mr. Quarteng’s mini-budget on Friday.

It added: “We write to highlight the grave danger that the Government’s stated ambitions to decarbonize transport with the switch to electric vehicles and your ambitious plans for the development of a comprehensive public charge point network, and Unstable electricity costs are happening.”

It continued: “A quick solution, which is completely within your control, is to heed the Fair Charge campaign’s call for an immediate reduction in VAT on electricity delivered by our network.

“Such cuts will immediately feed through the reduction in prices. In addition, it will show the strength of the government’s continued commitment to transport decarbonisation.”

The latest figures from the Society of Motor Manufacturers and Traders show that sales of new pure electric cars have increased sharply in recent months.

The number of registrations during the first three months of the year was 102% higher than the same period in 2021.

At the end of August, year-on-year growth had fallen to 49%.

FairCharge founder Quentin Wilson said the Treasury “needs to act now” on EV charging costs.

He continued: “This is a critical moment in the transition to electric cars, and the government should not be allowed to unintentionally sabotage this transition.

“This is also a huge opportunity for this new government to prove its green credentials and show that it is serious about net zero.”

RAC spokesman Simon Williams said: “In recent months ChargePoint operators have had no choice but to raise their charges to reflect the massive increase in the wholesale cost of electricity, and this is something we will be looking to worsen over the next few months.” can see.

“Charging 5% on domestic electricity to cutting 20% ​​VAT rate on public chargers will cost the government very little in the grand scheme of things and is absolutely the right thing to do.

“What’s more, it will be the drivers who rely on public charging networks – including those who cannot charge at home – who will benefit the most, eliminating the current disparity between driveways and those without. will help to do so.”

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