Energy bills hike: Expert slams ‘exceptional’ high energy costs about to hit Britons | Personal Finance | Finance
GB News have launched the campaign called “Scrap the VAT” in hope of the Government scrapping the unpopular levy on household energy bills. Liam Halligan has argued that cutting VAT could save around £100 a year on energy bills and that this is better than nothing.
Trade body Energy UK had predicted the sky-high rise could hit squeezed households in April – when changes to the price cap kicks in.
There have been warnings that average households could pay almost £700 or a more a year, amid surging prices for wholesale gas worldwide.
During On the Money, Liam Halligan spoke to Justin Urquhart Stewart about the ‘Scrap the VAT’ campaign.
Mr Stewart explained that due to the “exceptional” times and circumstances that Britons are in, exceptional measures and actions have to be taken to address it
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He said: “It’s not straight forward.
“The man is going to be on the street with costs like that in a few months’ time so it’s not about them saying ‘oh it’s a little price rise’, these are very significant price rises.
“It’s hitting the poorest the hardest so how do we try and balance that out? Maybe make it related to income tax bands or something like that. Some other mechanism!”
He stressed that “this is not a normal problem”, stating that government ministers should do more than just say they will try and provide some support.
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Mr Halligan explained that the average utility bill is £1277 a year but this is set to rise to £2000.
This “massive increase which will hit many ordinary families hard”, he said.
He described April as a “triple whammy” due to inflation, tax rises and spiralling energy costs so to ease the strain, GB NEWS is calling on the Government to ‘Scrap the VAT’ which is possible.
Energy regulator OFGEM is set to increase the price cap on energy bills on February 7.
This is expected to be over £2000 which is up from around £100 a month to a grand £170 per month per household.
But Mr Halligan argued that by taking the VAT off this sum, while “not huge”, it would be a five percent cut on Britons’ energy bills, roughly £100 a year.
Tony said: “Why is there VAT on something that is essential? There is no value on energy, it’s a necessity.”
However, Steven added: “It’s all good scrapping VAT on energy bills, but where will the money come from without it? My payments for my solar panels need to be paid for from somewhere.”
