Executive View: Reducing VAT on public charging is only a first step to boosting EV adoption

A report by the Resolution Foundation urges the government to align its policies with the swiftly evolving EV landscape to make adoption more accessible, particularly for low income families, writes Fraser Brown of automotive consultancy MotorVise.

It outlines key recommendations, such as introducing VAT parity for public charging. However, more must be done to ensure a fair and comprehensive EV transition.

Reducing the 20% VAT on public chargers to match the 5% rate applied to home chargers is a great first step. Many low-income families live in housing without off-street parking, which prevents them installing home chargers which benefit from much lower overnight tariffs.

The alternative is public chargers, a more expensive approach that effectively wipes out the much lower cost per mile figures compared with the internal combustion engine. Aligning VAT rates on public and home chargers would make EV adoption more attractive and help level the playing field for those unable to charge at home.

Beyond addressing this "charging divide," there are larger issues at play. In recent years, the government has withdrawn incentives on new EV purchases, claiming this is justified by falling EV prices. In reality, manufacturers have often had to absorb the financial burden, something that is unsustainable.

Furthermore, many prospective EV buyers don’t have access to existing tax breaks, such as salary sacrifice schemes, which are typically only a possibility for higher-income earners.

Road Tax

The government should also scrap plans to introduce EV road tax while reintroducing targeted incentives for private buyers to stimulate demand, such as the plug-in grant, which previously offered up to £2,500 towards the purchase price of a new EV.

Significant investment is also needed to expand the UK’s public charging infrastructure. Concerns about the availability and reliability of public chargers, especially in urban areas where on-street parking is common, deter many.

Currently, this infrastructure is not only limited, but expensive, with monopolies in the public charging sector which enable providers to charge high fees. We must also foster greater competition to achieve fairer pricing and improve access for all.

A targeted public information campaign would build public confidence in EV technology. Despite the growing number of zero emission cars on the road, many remain hesitant to make the switch due to persistent concerns around range, charging availability, and cost—often rooted in misconceptions or a lack of reliable information.

A well-designed campaign could address these concerns by educating the public on the cost savings and environmental benefits.

Training

Dealerships can also support the transition to zero emissions motoring by rethinking their sales strategies to actively engage with customers about EV ownership. A survey carried out by MotorVise found 80% of car buyers will not consider an EV due to  misleading information and misconceptions, while a majority of dealership sales teams are hampered by a lack of training in this area.

Such training embeds EVs firmly within the sales process and provides salespeople with the knowledge to ask the right qualifying questions and offer accurate answers around practical ownership, ensuring every customer will be offered an EV option and test drive if it fulfils their current and future needs.

The Resolution Foundation report underscores the importance of decarbonising transport as a key step towards the UK’s net-zero goals. Cars account for two-thirds of all transport emissions, yet by achieving a successful EV transition, it estimates that households could save an average of £650 annually on transport costs by 2035 due to EVs’ lower operating costs compared to petrol and diesel vehicles.

Across the UK, these savings could reach £22 billion. This potential economic impact should incentivise policymakers to make EV transition accessible and equitable.

Fraser Brown is managing director of MotorVise