New analysis says the temporary VAT cut will force EV drivers with no off-street parking and those who rent, £172 million per year on charging costs.
Research by New AutoMotive says this will counteract the £40 million that the Government have proposed to save in the recent VAT cut on domestic electricity. The group are calling for an expansion on time-of-use tariffs at public chargers.
The 9% of drivers with no home charging won’t make any savings and pay £216 per year in VAT – whilst drivers with a dedicated charger on a standard tariff save £27 annually.
Ben Nelmes, Chief Executive of New AutoMotive, said: “The Government have handed EV drivers with a driveway a tax cut on power they were already paying least for.
The policy has inadvertently exposed a structural unfairness in how EV charging is taxed: those with driveways get tax-free power, while those without, concentrated in cities and among renters, pay a 20% premium simply for lacking access to a plug at home.”
The group are also calling Ofgem to re-evaluate the grid connection costs for public chargers and improve access to cross-pavement charging so more drivers can charge EV’s at home.
The new VAT cut is set to come into effect from the 1st October.
