Leading voices from across the electric vehicle charging industry have reacted with anger and frustration to HMRC’s confirmation that it will appeal the First-Tier Tribunal’s ruling that public EV charging should qualify for a reduced 5% VAT rate. This, they say, engenders a two-tier system that penalises drivers without driveways and undermines the government’s own EV ambitions
The ruling, which arose from a case brought by Charge My Street against HMRC, had offered hope that the longstanding VAT disparity between public and home charging would finally be addressed.
HMRC’s decision to appeal means that the millions of drivers who rely on public charge points will continue to face VAT at 20%, four times the 5% rate paid by those who charge at home.
Domestic electricity in the UK attracts a 5% VAT rate. Public EV charge points are subject to the full 20% rate, meaning drivers who rely on public infrastructure – typically those without access to off-street parking – face a structural cost disadvantage compared to those who can charge at home. The First-Tier Tribunal’s ruling in the Charge My Street v HMRC case found that electricity supplied at public charge points, under certain consumption limits, can be treated as domestic use and taxed accordingly. The government’s decision to appeal means that the ruling does not take effect pending the outcome.
John Lewis, CEO of char.gy, said:
“This is a deeply disappointing decision, and one that sends entirely the wrong signal to the millions of people who rely on public charging. While home charger users pay 5% VAT, drivers without a driveway – disproportionately those in cities, renters, and lower-income households – continue to be penalised at 20%.
“The government talks about accelerating EV adoption, yet is actively choosing to maintain a tax structure that makes public charging more expensive than it needs to be and undermines the transition. char.gy stands ready to pass on any VAT saving to our customers the moment the government does the right thing. The question is: what is the government waiting for?”
Ginny Buckley, CEO at Electrifying.com, added:
“For a government that talks about standing up for ‘working people’, the decision to appeal this ruling flies in the face of that. Ministers are doubling down on a system that penalises millions of drivers who rely on public charging. Those drivers can pay up to ten times more to charge an electric car than someone with a driveway – and in some cases, that makes EVs more expensive to run than petrol.
“This hits those without driveways the hardest, making it more expensive for them to switch and if the government is serious about making EVs affordable, it cannot allow a two-tier system where access to cheaper, cleaner driving depends on what type of property you have.”
(Picture: Yay Images)
