MPs urge Chancellor to slash EV ‘Pavement Tax’
A cross party group of MPs and Peers have written to the Chancellor in the run up to his Spring Budget urging him to abolish the so-called electric vehicle ‘pavement tax’ in order to boost EV adoption and speed up a cleaner air future for all.
The pavement tax hits EV drivers who are forced to use public chargers because they have no driveway. The VAT rate on electricity from public chargers is 20% whereas the rate on electricity from home chargers is only 5%, hence a pavement tax of 15%. Public charging prices can also be up to 10 times higher than charging at home, and lead to the public becoming increasingly weary of the switch to EVs.
The MPs and Peers are supporting the call of the FairCharge campaign for the Chancellor to slash VAT on electricity from public chargers from 20% to 5% to end this unfair situation.
Over 40 MPs and Peers have written to the Chancellor.
Derek Thomas, Conservative MP for St Ives, West Cornwall and the Isles of Scilly: “It is essential that this financial barrier to electric cars is removed, which is why I am encouraging all parliamentarians to join me in calling on the Chancellor to Axe the Pavement Tax. Demanding more tax from people simply because they don’t have a driveway is hardly the best way to help them make the switch to electric cars. We need to make it easier for drivers to go electric, not harder.”
A recent report by respected Conservative MP Chris Skidmore into what the Government needs to do to meet its climate goals also calls for the cut in VAT.
Founder of the FairCharge campaign and motoring journalist Quentin Willson said: “The Chancellor should use the Spring Statement to make a generational commitment to electrification. He needs to create investment confidence, attract global capital, and strengthen our energy independence. The US and Europe are leading us in the global race for EV investment.
“The UK won’t be taken seriously as an investment destination for EV infrastructure if it has an illogical tax burden on electric charging. The Treasury is disadvantaging drivers by forcing them to pay four times the rate of VAT simply because they don’t have a driveway. Nearly four in 10 households won’t be able to charge at home. Such an archaic tax policy won’t attract infrastructure investment.
“The high rate of VAT on public charging is slowing EV adoption just as the rest of the world is investing in electrification. If the Government doesn’t take urgent action, we will lose the opportunity for tens of billions in economic activity and tens of thousands of new highly paid, highly skilled jobs.”