For motorists who can plug their cars into a charger on their own driveway, the reduction in VAT could provide a modest but noticeable reduction in annual running costs. The saving will depend heavily on how much electricity a household uses, how frequently the vehicle is charged and the tariff being paid.
That means the headline figure of £40 should not be interpreted as a guaranteed payment or universal saving for every driver.
Instead, it represents the upper end of the potential annual benefit for motorists with relatively high mileage and significant home-charging requirements.
For an average driver, the saving could be considerably lower.
Nevertheless, supporters of the measure argue that small reductions in household running costs can add up, particularly at a time when many families remain concerned about energy bills and wider household expenditure.
The change also has a broader political significance.
The Government is attempting to encourage the transition towards electric vehicles while simultaneously facing criticism over the affordability of that transition. Electric cars can have lower running costs than comparable petrol or diesel vehicles, but the initial purchase price, insurance, charging infrastructure and access to cheap electricity remain important barriers.
A reduction in VAT on domestic electricity could therefore be presented as part of a wider attempt to make electric motoring more attractive.
However, the policy also highlights an increasingly important divide between motorists who have access to private parking and those who do not.
Households with driveways can install home chargers and take advantage of domestic electricity prices. Drivers living in flats, terraced streets or areas without dedicated parking may have no choice but to rely on public charging infrastructure.
That distinction could become increasingly significant as the number of electric vehicles on British roads continues to rise.
Public charging can be substantially more expensive than charging at home. The difference becomes particularly noticeable for drivers who need to charge frequently.
A motorist charging a large battery at home can therefore potentially save much more over the course of a year than someone who has to depend almost entirely on public charging stations.
This creates a political question for ministers: should the Government provide additional support for people who cannot charge at home?
Critics of the VAT change could argue that cutting domestic electricity VAT disproportionately benefits homeowners and motorists with driveways, while millions of people without private parking may see little or no direct benefit.
The Government could respond that reducing VAT on household electricity is not an electric vehicle subsidy. It applies to domestic electricity generally, meaning households can benefit regardless of whether they own an electric car.
That distinction is important.
The measure is primarily an energy policy rather than a scheme designed exclusively for motorists. Electric vehicle owners simply have another way of benefiting because charging their cars at home forms part of their household electricity consumption.
For families already struggling with energy bills, the broader effect could therefore be more significant than the saving associated with car charging alone.
The policy could also influence decisions about where people charge their vehicles.
If the gap between home and public charging prices remains large, motorists with access to driveways are likely to continue charging primarily at home. This could reduce demand for expensive public charging for some users, while increasing the importance of home charging infrastructure.
The Government will nevertheless need to consider the infrastructure challenge created by motorists without driveways.
The UK’s transition to electric vehicles cannot depend solely on homeowners with garages or private parking spaces. Millions of people live in properties where installing a private charger is difficult or impossible.
For these drivers, reliable public charging is essential.
That means the future of electric motoring is likely to involve a mixture of home charging, workplace charging, supermarket facilities, motorway services and public street chargers.
The Government’s VAT policy does little to solve the underlying problem of unequal access.
Some local authorities have begun installing on-street charging points, but coverage varies significantly between areas. Drivers can face different prices depending on the operator, location and type of charger.
Rapid chargers can be particularly expensive because motorists are paying for speed and convenience.
A driver who can charge overnight at home may pay a fraction of what another driver pays to replenish the same amount of energy at a rapid public charger.
This could become an increasingly important political issue as the Government pushes forward with policies designed to increase electric vehicle adoption.
There is also a question about how much of the VAT saving will actually reach consumers.
Electricity suppliers set their own tariffs, and household bills are affected by wholesale energy prices, standing charges and other costs. A reduction in VAT does not automatically mean every household will see exactly the same reduction in their final bill.
For electric vehicle owners, the calculation is even more complicated.
Some drivers have smart tariffs that offer cheaper electricity overnight. Others charge whenever their vehicles need energy. Those differences mean two households with identical cars could experience very different savings.
This is why motorists should treat estimates such as £40 a year as an indication rather than a guaranteed figure.
The bigger question is whether the policy will have any meaningful effect on Britain’s wider energy and transport strategy.
Electric vehicles are expected to play a major role in reducing transport emissions, but encouraging consumers to switch requires more than tax changes.
Drivers need affordable vehicles, accessible charging, reliable electricity supplies and confidence that they will not face excessive costs when travelling long distances.
A VAT reduction can help with one part of that equation, but it cannot solve all of the challenges.
There is also a potential political benefit for Mr Burnham.
With household finances remaining a major concern for voters, a policy that produces a visible reduction in electricity costs gives the Government an opportunity to argue that it is directly helping families.
The electric vehicle element provides an additional message: households that have invested in newer, cleaner vehicles can potentially benefit from lower charging costs.
But opponents are likely to argue that the savings are relatively small compared with the overall cost of owning and running a vehicle.
A £20 or £40 annual reduction will not transform household finances for most drivers. Even the higher estimates of around £65 depend on charging patterns and electricity consumption.
For a family facing significantly higher mortgage, rent, food or insurance costs, such a saving may barely be noticed.
That does not necessarily make the policy irrelevant.
Tax reductions are often judged not only by the amount saved by an individual but also by their cumulative effect across millions of households.
If millions of households pay slightly less VAT on electricity, the combined reduction in household costs could be substantial.
The political challenge is explaining that benefit without overselling the impact.
For motorists with driveways, the message is relatively straightforward: from October 1, charging an electric vehicle at home could become slightly cheaper because the electricity used for charging will benefit from the lower domestic VAT rate.
For those without private parking, the picture is more complicated.
They may still benefit from the wider reduction in household electricity costs, but they are unlikely to receive the same advantage when using public charging points where different VAT treatment and commercial pricing can apply.
That distinction means the new policy is unlikely to end the debate over charging inequality.
Instead, it could make the issue more visible.
As Britain moves towards a transport system increasingly dominated by electric vehicles, access to cheap charging could become almost as important as access to the vehicle itself.
The next stage of the Government’s strategy will therefore be watched closely.
If ministers want electric vehicles to become genuinely accessible to ordinary households, they will need to address not only the cost of electricity at home but also the price and availability of public charging.
For now, however, motorists with driveways have a relatively simple reason to pay attention to October 1.
The VAT change will not put £40 into every driver’s bank account, and it will not eliminate the cost of running an electric car.
But for households able to charge regularly at home, it could provide another small reduction in annual motoring costs.
And as the Government tries to balance the cost-of-living crisis with its long-term energy and environmental ambitions, even relatively modest savings are likely to carry considerable political weight.