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Written question asked by Angus MacDonald (Liberal Democrat) on Friday, 15 May 2026, in the House of Commons. It was due for an answer on Tuesday, 19 May 2026. It was answered by Dan Tomlinson (Labour) on Tuesday, 26 May 2026 on behalf of the Treasury.


Electricity: Standing Charges

Question

To ask the Chancellor of the Exchequer, what assessment her department has made of the potential impact of VAT on domestic energy bills on regional inequalities in electricity standing charges and unit rates.

Answer

The Government is committed to lowering the cost of standing charges and have worked constructively with the regulator, Ofgem, on this issue. At the same time, the Government has taken significant steps to support households with the cost of energy while we transition to cheaper, clean power by 2030.

Domestic gas and electricity, including heating oil, benefit from a reduced VAT rate of five per cent, rather than the standard 20 per cent. This reduced rate cost the Exchequer an estimated £6.5 billion in 2024–25.


Secondary information

Type
Written question
Reference
1801
Session
2026-27
Transferred
Yes
Subjects
Billing Equality Energy Electricity Standing charges VAT
Link
View this Written question on www.parliament.uk