9:17 am, February 12, 2025
An EV lobby group has written to the chancellor demanding that VAT be cut on public charging, with industry big wigs lining up to back the proposals.
FairCharge, which campaigns for ‘EV affordability for all’, has written to the Treasury urging them to cut VAT on public charging from 20% to 5%.
It says the move would help build consumer confidence and increase EV take up among buyers who can’t charge at home.
It had previously been hoped that the measure would be included in last autumn’s Budget but the government largely resisted calls for additional EV support.
FairCharge says is has been ‘surprised’ by how ‘reluctant’ the Government has been to act on the issue, labelling the stance a ‘bizarre and conspicuous policy omission’.
Quentin Willson, founder of FairCharge, said: ‘I ask the Chief Secretary of the Treasury that he must realise, with the UK as the most successful EV market in Europe, the opportunities for growth in the sector are significant.
‘But holding that growth back is an archaic piece of tax legislation conceived before the era of electric cars.
‘So many voices are now calling for a cut in the VAT on public charging that the Treasury’s negative response seems almost churlish.
‘We spoke about this unfair tax anomaly before Labour came to power. It’s time for you and I to talk again.’
The calls have been backed by several powerful leaders from within the automotive industry, including the bosses of Stellantis and Polestar.
Eurig Druce, group managing director of Stellantis UK, said: ‘The path to electric has been set but there is a real risk of creating a two-tier motoring system where those with a driveway pay less to get around than those without.
‘That can’t be right and that’s why we support the FairCharge campaign.’
Matt Galvin, managing director of Polestar UK, added: ‘We have been calling for VAT on public charging to be brought into line with home charging for some time now.
‘This is an urgent requirement to support EV adoption, particularly to encourage the private buyer, and prevent unfair costs to those without driveways.
‘Manufacturers have invested billions of pounds in EV technology to meet mandates and now the industry needs the Government to play their vital role in achieving a net zero car market which is pivotal to improve air quality and slow down climate change.’
Labour says it remains committed to seeing the UK switch over to EVs, having reinstated the 2030 ban when it took office last year.
The Government also recently announced plans to pump £65m into kerbside charging firm Connected Kerb, in a bid to help improve infrastructure for those without a driveway.
However, the issue of VAT on public charging so far remains unaddressed and experts believe action now needs to be taken.
‘The Government has championed the EV transition with bold policies and strategy plans, but has yet to act on one of the simplest, most obvious changes – cutting VAT on public charging,’ said Delvin Lane, CEO at InstaVolt.
‘This small change would bring fairness to those without home chargers, encourage more drivers to switch, and support price parity between home and public charging.
‘It is surprising that there has been no movement on this. With so much at stake for effectively so little cost, the Government should act now to remove this barrier and avoid stalling the EV revolution.’
Ian Plummer, Auto Trader’s commercial director, added: ‘It is simply unfair that EV owners without driveways should have to pay more for the privilege to charge their car and therefore to positively improve air quality.
‘It’s time for the Treasury to address this injustice and give EVs the best chance of widespread adoption.
‘We need this transition to be fair and equitable for all, regardless of whether people have a driveway or not. Consumers need more of a reason to make the switch so removing barriers and making EVs more affordable to own is only going to accelerate adoption.’
