Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential merits of classifying bi-directional EV charging as an Energy Saving Material.

The installation of qualifying energy-saving materials (ESMs) in residential accommodation and buildings used solely for a relevant charitable purpose benefits from a temporary VAT zero rate until March 2027. Following a Call for Evidence (CfE) last year, electrical storage batteries were one of the technologies added to the relief. However, as set out in the Government response to the CfE, at that time, the Government was unable to identify sufficient independent data regarding the efficiency of heat batteries. As such, they do not currently qualify for VAT relief.

EV charge points were also proposed to be added to the ESMs VAT relief by CfE respondents. However, they were not added to the relief, because their primary purpose is not to save energy or reduce carbon emissions, meaning EV charge points don’t meet the objectives of the relief.

The Government currently has no plans to add further technologies to this VAT relief. Nevertheless, the Government keeps all taxes under review as part of the policy making process. Changes to the tax system are announced at fiscal events in the usual way.