The UK government will introduce a new electric vehicle excise duty (eVED) from April 2028, charging 3p per mile for electric cars and 1.5p per mile for plug‑in hybrids. The levy will be administered by the DVLA and integrated into the existing VED system, with a consultation deadline of 18 March 2026.
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Energy Digital · about 8 hours ago
UK: New Prime Minister Andy Burnham will cut VAT on electricity bills from the start of October, exempting households in England, Scotland and Wales for six months. The measure will reduce average household bills by about £45 and cost the Treasury roughly £850m this financial year.
TaxResearch · 1 day ago
The UK will remove VAT from electricity bills from October, cutting average annual bills by about £45 per household. The move is expected to reduce tax revenue by roughly £1.1 billion, but critics argue it does not address underlying grid capacity issues.
Guardian · 1 day ago
The UK government will remove VAT from electricity bills for households in Great Britain from 1 October 2026, reducing the annual price cap by £45. Northern Ireland will retain the 5% VAT rate, and the cut does not apply to gas.
VatCalc · 1 day ago
The United Kingdom has announced that domestic electricity bills will be zero-rated from 1 October 2026, reducing the VAT rate from 5% to 0%. The measure is temporary, applying until 31 March 2027, and will be funded by cancelling the planned Digital ID programme.
The Independent · 2 days ago
The UK government will remove VAT from domestic electricity bills from 1 October 2026, cutting the rate from 5% to 0%. The change is expected to save households around £45 a year and will be funded by cancelling the Digital ID programme.
The Independent · 2 days ago
In the UK, the government announced an £850 million tax cut on energy bills, making electricity bills VAT free from 1 October 2026 in England, Scotland and Wales. Northern Ireland remains exempt because EU VAT rates apply under the Windsor Framework, preventing the cut from applying there.
Key Takeaways
eVED will come into force from April 2028 for UK‑registered electric and plug‑in hybrid cars.
For 2028‑29, the rate is 3p per mile for electric cars and 1.5p per mile for plug‑in hybrids.
The consultation deadline is 18 March 2026.
Primary source
Read the full article at ICAEWThis summary was published on VATfaqs.com on 21 January 2026. It relates to VAT developments in United Kingdom. The original source is ICAEW.
