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  • Writer's pictureFairCharge

#Pavement Tax for EV drivers without driveways reaches up to £227

Updated: Aug 8, 2023

Today, in collaboration with Zap-Map, we released findings that the tax discrepancy for electric vehicle drivers without private parking has risen to up to £227 per year, in light of increased public charging costs. The ‘pavement tax’ is the result of the unfair VAT discrepancy which leaves drivers using the public charging network paying a 20% VAT rate in comparison to the 5% rate on home charging.

The damning findings reflect the growing cost of charging an electric vehicle on the public charging network, where the average cost of EV charging for those with private parking is now £863 per year, compared to £1418 for those without. In August, the average cost of using a rapid or ultra-rapid charger rose from 44p/kWh in March to 56p/kWh, and the cost of using a fast or slow charger rose from 30p/kWh to 39p/kWh.

For the 38% of UK households without private parking, this means those with EVs face paying an additional £148 per year in tax alone[HC1] , up from £115 in March. However, this tax discrepancy could be as high as £227 per year given that EV drivers with home charging can access low-cost overnight tariffs, such as the 7.5p/kWh tariff offered by Octopus Go.

At FairCharge, we are calling on the Treasury to address this unfair and illogical VAT policy, which risks hindering growth in EV adoption, investment in charging infrastructure and ultimately, the wider transition to cleaner air and energy security.

Quentin Willson, Founder of FairCharge, said:

“The growing discrepancy between the cost of charging an electric vehicle at home and on public networks is incredibly concerning for the 38% of UK households without driveways. This outdated VAT legislation is in need of immediate reform or else the Treasury risks hindering growth in EV adoption, investment in charging infrastructure and ultimately, the wider transition to cleaner air and energy security.

The EV transition should not come at a cost to those without private parking. If the Chancellor isn’t concerned about the sheer unfairness of the policy, then surely he can at least see the economic case that it is undermining investment in the public charging network, which would otherwise be helping boost growth. “I urge the Government to take the relatively simple, low-cost, step and immediately axe the Pavement Tax.”

Melanie Shufflebotham, Co-founder & COO at Zap-Map, said:

“With drivers up and down the country increasingly making the switch to electric, the ‘Pavement Tax’ issue is only becoming more pressing. Charge point operators across the UK are investing huge amounts of time and effort into creating a robust charging network that works for everyone, while EV drivers are only trying to do the right thing and reduce their carbon emissions – those without access to a home charger should not be penalised for doing so. “While it’s great to see Zap-Map data put to good use in the FairCharge campaign, it’s imperative that the Government sees sense and acts now to reduce the rate of VAT on public charging.”

Simon Williams, RAC EV Spokesperson, said:

“The Government needs to be doing all it can to encourage as many drivers as possible to go electric the next time they come to change vehicles which is why we believe it’s essential to bring the VAT rate at public chargers in line with the 5% that’s levied on electricity at home. This would be an easy change that would cost the Treasury relatively little yet send a very strong message to drivers, especially those who don’t have driveways or rely on charging up away from home, that switching to an EV is the right choice.”


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