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Logistics UK disappointed by ruling that VAT on electricity for public EV chargepoints will not be cut


Logistics UK has expressed its disappointment that the government has ruled out cutting VAT on electricity from 20% to 5% for public EV (electric vehicle) chargepoints.

This is in contrast to the 5% rate of VAT enjoyed by homeowners that have their own EV charge points.

The drivers of many Logistics UK members take their vans home after their shifts. As four out of ten households are estimated not to have access to off-street parking or live in rental accommodation so are unable to charge an electric van at home, many members’ drivers are reliant on public chargepoints to ensure their vans are ready for their next day at work. Despite this, the government has stated it currently has no plans to review the current rate of VAT applied to charging EVs at public chargepoints.

According to ONS Business Population Estimates for 2021, 2.9 million businesses, including self-employed tradespeople who rely on vans for their trade, are not registered for VAT because their turnover is below £85,000 per year, so are unable to claim back VAT.

Helen Whately MP, Exchequer Secretary to the Treasury, has confirmed that the government has no plans to review the current rate of VAT applied to charging electric vehicles.

Denise Beedell, Public Policy Manager, Logistics UK, said: “Transport decarbonisation has a vital role to play in the UK reaching net zero by 2050 and the logistics industry is keen to play its part. However, if transport decarbonisation is to take place as quickly as possible, all types and sizes of businesses across the van sector, need to move away from petrol and diesel vans. Aligning VAT rates for EV charging wherever they take place is an opportunity for government to demonstrate the importance of vehicle decarbonisation and avoid a longer than necessary transition away from fossil fuelled vans.”

*www.logistics.org.uk/environment

Published On: 07/04/2022 16:00:15

 

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