Labour Urged to Cut VAT on Public EV Charging to Boost Electric Car Adoption
Labour is facing calls to reduce tax burdens for electric vehicles as high costs continue to deter drivers from abandoning petrol cars. Fresh research indicates that cutting VAT on public EV charging from the current 20 per cent rate down to just five per cent could result in annual savings of approximately £350 for motorists.
Poll Reveals Strong Support for VAT Reduction
A comprehensive survey of 3,700 motorists uncovered compelling data about how a VAT reduction would influence consumer behavior. The poll found that 47.5 per cent of respondents stated they would be "more likely" to switch to electric vehicles if the new VAT rate were implemented. Even more strikingly, 31.2 per cent indicated they would be "much more likely" to make the transition under these conditions.
This research follows a significant legal ruling on 27 February 2026, when a First-tier Tribunal determined that public EV charging should be subject to a 5% VAT rate rather than the standard 20%. This decision addresses a long-standing imbalance that has disproportionately penalized drivers without access to private driveways or home charging facilities.
Charging Accessibility Challenges for Many Drivers
The survey revealed substantial barriers to home charging installation that affect a significant portion of the driving population. More than one-fifth of drivers lack the ability to install a home charger, with specific breakdowns including:
- 11 per cent who rely exclusively on on-street parking
- 6 per cent with private parking spaces but no charging capability
- 3 per cent using shared car parks
- 2.8 per cent with no regular parking access whatsoever
These findings highlight the critical importance of affordable public charging infrastructure for equitable electric vehicle adoption.
Industry Expert Weighs In on Charging Affordability
Steve Walker, head of digital content at Auto Express, emphasized the significance of public charging costs in the broader EV adoption landscape. "It's clear that the cost of public charging is one of the biggest obstacles to wider EV adoption," Walker stated. "Cutting VAT to five per cent would bring it more in line with home charging and remove a key financial disadvantage."
Walker further explained the disproportionate impact on certain drivers: "While the majority of drivers do have access to a driveway or garage, a significant minority rely on public infrastructure. These drivers are disproportionately affected by higher costs, including the 20 per cent VAT rate currently applied to public charging."
The poll data strongly supports Walker's assessment, with 76 per cent of respondents agreeing that cheaper public charging would make electric vehicles more accessible to those without home charging options. Additionally, nearly three in five participants (just under 60%) stated that reduced VAT would "significantly" improve access, underscoring widespread concerns about affordability in the transition to electric transportation.
