VAT cut 2022: What Labour’s proposals could have meant for your energy bills | Personal Finance | Finance

If Ofgem raises the cap, in April 2022 energy bills could continue to rise even higher.

Currently, Ofgem states the cost of VAT on an average household energy bill as £61, whereas the average household energy bill is £1,277.

Analysis by the Labour Party said its package to help households could save “most households around £200 or more”.

The Labour Party’s analysis was based on an estimate that the average household bill will rise to £1,865, according to the BBC.

Labour’s statement said: “Crucially, the Party said it would also target extra support to squeezed middle, pensioners and the lowest earners, receiving up to £600 off bills and preventing all of the increase in energy bills currently expected.”