Solar Roof

HMRC to raise VAT to 20% on solar battery systems – EU to blame?

HMRC today pushed for legislation to raise VAT from 5% to 20% on solar battery systems. Why? Apparently because the EU ruled that reduced VAT rates amount to a state subsidy, which is not allowed. Hence the UK needs to get in line.

HMRC pushes steep VAT increase for new solar-battery systems

Treasury proposes rise from 5% to 20%, while the tax on coal will stay at lower rate

I’m generally pro EU but here is an example where its behaviour is wrong, for numerous reasons but not least for slowing the rate of uptake. Strikes me that a stand could be made on matters like these, if the Government had the balls to challenge the EU.

For property people and home DIYers there is an important caveat to be aware of. The 20% rate applies to HARDWARE ONLY, installation charges should continue to be charged at 5% VAT.

Halt the solar and storage VAT hike

This hike is certain to hit innovation and investment in the UK’s growing solar and battery storage market. Not to mention the vital progress on decarbonising heat, which according to the Spring Statement is a strong focus for this government. There could not be a more contradictory step following the declaration of a climate emergency by parliament.

As with all these things there is, of course, a petition to lobby and apply pressure not to bring in the raise. This one courtesy of 38Degrees. I have signed for all it may be worth – better to do a little something than nothing though, right?