UK Scraps 5% VAT on Electricity

In one of his first moves as the UK’s new Prime Minister, Andy Burnham announced on Tuesday that the new Labour government would scrap the 5% value added tax (VAT) on electricity bills to help Britons cope with rising energy costs.

The government will introduce a tax cut to remove VAT from domestic electricity bills from October 1 in time to impact the next Ofgem price cap on energy bills for households. This action is funded for this financial year, the new government, in office since Monday, said on Tuesday.