Andy Burnham has overseen new updates to driveways this October with EV owners facing major changes.
Andy Burnham has updated electric VAT charges this October (Image: Getty)
Andy Burnham has introduced a new 2p per mile driveway rule this October as VAT fees are slashed by the Prime Minister. The Labour leader cut VAT rates on domestic electricity charges from 5% to 0%, with the new rule coming into effect on October 1 in one of his first moves in Downing Street.
The decision has a knock-on effect on electric car owners, with prices cut for those topping-up their car on their driveway or in an off-street parking space. New analysis from costpermile.co.uk has worked out the impact of the fees based on a standard family electric hatchback or SUV achieving an average efficiency of 3.5 miles per kWh.
They have explained that motorists topping up their EV battery at home using a smart tariff can make the highest savings. For these owners, the new 0% VAT fee will reduce fees to just 7p per kWh or around 2p per mile.
Over the course of an average 10,000 miles per year, road users will be paying just £200 in electricity costs. Motorists charging their EV battery on a home standard domestic tariff can also take advantage of the new 0% VAT rate. Road users topping-up using this option will be paying 24p per kWh, with drivers paying 6.9p per mile or around £690 per year.
Matt Galvin, Managing Director at Polestar UK previously said the new move would make owning an EV even more affordable for British motorists.
Driveway VAT fees were cut from 5% to 0% this October (Image: Getty)
He said: “Scrapping VAT on electricity will make owning and charging an electric vehicle even more affordable for millions of households. It is an important first step towards lowering the cost of living while accelerating the transition to clean transport. With some of the highest electricity prices in the developed world, reducing the cost of electricity must now become one of the government’s defining economic and energy priorities.”
However, Matt also stressed there was more to do as he urged officials to also consider abolishing VAT on public EV charging.
Those topping up at public bays are still charged at 20% VAT to charge their cars, with costpermile.co.uk putting the average retail park or supermarket fees at 52p per kWh, around 12.6p per mile.
Matt added: “The new administration must now extend the five chargepoint grants for households without off-street parking beyond the March 2027 deadline and abolish VAT on public EV charging, which continues to unfairly penalise drivers without a driveway.”