Homes hoping to shrink their carbon footprints by installing a solar-battery system face a steep VAT increase from October under new laws proposed by HMRC. The Treasury put forward legislation on Monday to raise VAT for home solar-battery systems from 5% to 20%, on the same day that MPs are debating the government’s new net zero carbon target for 2050. Meanwhile, home coal supplies will continue to receive the lower VAT rate. The Renewable Energy Association (REA) said the rise “contradicts the government’s commitment to tackling climate change” only weeks after parliament declared a climate emergency. It also warned that the move would push back the take-up of solar-battery systems by years even as the UK works towards becoming a net zero carbon economy by 2050. Nina Skorupska, the REA’s chief executive, said the increase would “create a barrier to British homes and businesses who are seeking to take action on climate change and reduce their bills by installing solar with battery storage”. Juliet Davenport, Good Energy’s chief executive, said the rise was “possibly the worst way to respond to a climate emergency”. “The government should be seeking to be a world leader in renewable technologies, but it’s damaging our successful solar industry and putting green jobs at risk. We urge the Treasury to listen to the thousands of petitioners who want to play their part in fighting climate change,” she said.
Guardian 24th June 2019 read more »
Legislation to increase the rate of VAT attached to solar panels and home batteries to 20% move forward yesterday following a legislation committee hearing that included accusations of government errors and “bombast and windbaggery”. Yesterday (Monday 25 June) legislation was put forward containing the VAT increase, which will see tax on home solar and battery storage systems ramped up from 5% to 20%. While some exemptions will remain – housing associations, people over 60 and those on certain benefits will continue to pay the 5% rate – and the increased rate will not apply to labour costs, the industry has warned of the significant detrimental impact the rise could have on installations.
Solar Power Portal 25th June 2019 read more »