Energy VAT cut ‘does not address scale of what households are facing’

Removing VAT from electricity bills from October is a "positive statement of intent" but "does not address the scale of what households are facing", experts have said. Prime Minister Andy Burnham's announcement that electricity bills will be VAT free from October 1 will cut £45 off a typical home's annual bill based on Ofgem's current price cap. Ofgem updated its definition of a typical consumer from July to reflect falling household energy use, which adjusts the headline figure to £1,700. "There's talk of moving some levies into general taxation and even bringing in block tariffs, which would be a much bigger shift than a VAT cut. This would be £45 off a typical home's annual bill based on the current electricity price cap.