PARLIAMENTARY WRITTEN QUESTION
Energy: VAT (11 January 2022)

To ask the Chancellor of the Exchequer, what assessment his Department has made of the potential merits of reducing VAT on domestic energy in response to rising fuel costs.

Asked by:
Lee Anderson (Reform UK)

In recognition of the fact that families should not have to bear all the VAT costs they incur to meet their energy needs, the Government already maintains a reduced rate of 5 per cent VAT on the supply of domestic energy, at a cost of £5 billion per year.

Although the Government keeps all taxes under review, going further would impose additional pressure on the public finances, to which VAT makes a significant contribution. VAT raised around £130 billion in the year 2019-20, and helps to fund key spending priorities, including on health, education, and defence.
Answered by:
Lucy Frazer (Conservative)
19 January 2022