What Car? has predicted that the Chancellor will reduce VAT on public EV charging in today’s Spring Statement.

Last week, a UK tax tribunal ruled that VAT on public vehicle EV charging should be cut from 20% to 5%.

The judgment follows years of campaigning for the 20% VAT rate on public charging to drop to 5% to match the domestic VAT rate for electricity. This would tackle an “illogical” policy that puts the c.40% of drivers without access to home charging at a cost disadvantage when it comes to running an EV.

What Car? has urged the Government to abide by the tax ruling and reduce VAT on public charging in the Spring Statement.

Calculations by the car buying platform indicate that such a VAT cut would save EV drivers up to £389 a year for a weekly 10-80% charge in a Hyundai Ioniq 5, if charging firms passed the saving on. The saving equates to a discount of £7.48 on a charge costing £49.84.

However, in the short term, this benefit depends on the public charging networks passing on the full savings to motorists.

What Car? previously called on the Government to cut the VAT rate for public EV charging for the past year as part of its EV Manifesto, which outlines a sweeping number of changes designed to make the switch to electric cars easier.

The publication said the charging VAT cut is essential to curb the escalating costs EV drivers will incur from April 2028 when the new eVED pay-per-mile arrives, under current government plans. Initially set at a rate of 3p per mile, this will cost around £388 a year, according to What Car? calculations.

Consumer editor Claire Evans said: “Although it will be great news if the Government finally listens to calls to make the cost of public EV charging fairer, EV drivers should ensure they take advantage of the savings while they can, because they will only be temporary.”