The Chancellor is to zero VAT rate on energy-saving materials and installation in a bid to help families cut their energy costs and make improvements in decarbonising their homes.
The Solar Trade Association has welcomed the move, which will last for five years starting from tomorrow.
Chris Hewett, Solar Energy UK’s Chief Executive says: “Solar Energy UK is delighted to see VAT reduced on solar and other energy saving materials for residential use, after many years of calling for this. It is common sense for the Treasury to be encouraging greater uptake of all zero carbon technologies in the face of an energy security crisis and climate emergency. It will be seen as a real endorsement of solar, as well as improving the pay back for many consumers who may be on the fence.”
“Reducing the VAT rate on energy-saving materials and installation would help families cut their energy costs permanently and afford improvements towards decarbonising their homes” he said.
The Spring Statement highlights: “To help households improve energy efficiency and keep energy costs down – as well as supporting the UK’s long-term Net Zero ambitions – the government is extending the VAT relief available for the installation of energy saving materials (ESMs).
Taking advantage of Brexit freedoms, the government will include additional technologies and remove the complex eligibility conditions, reversing a Court of Justice of the European Union ruling that unnecessarily restricted the application of the relief. The government will also increase the relief further by introducing a time-limited zero rate for the installation of ESMs. A typical family having rooftop solar panels installed will save more than £1,000 in total on installation, and then £300 annually on their energy bills”.
