EV COST DISPARITY: How do home and public charging facilities affect the taxi trade?
The disparity in VAT rates between public charge points and those connected to residential properties significantly impacts individuals without access to private home charging facilities, including a considerable number of taxi drivers.
The 20% VAT levied on public charging stations compared to the 5% on home charge points introduces a financial imbalance that affects those reliant on public infrastructure for their electric vehicles (EVs).
For the 44% of UK households that Lloyds Bank identifies as unsuitable for EV ownership due to the absence of private charging options, this tax discrepancy means higher operational costs.
For taxi drivers, whose livelihoods depend on frequent and cost-effective vehicle charging, this disparity can lead to increased expenses for some.
This financial strain is compounded in rural or underserved areas where public charging infrastructure is even less developed and potentially more expensive due to lower availability.
There are also questions around how the disparity in costs will affect the metered price for the passenger. Taxi tariffs usually take into account the cost of running a taxi vehicle which could mean prices are inflated for one set of drivers who are able to make the savings, or priced too low for those drivers unable to charge at home.
This tax rate difference not only makes electric vehicles less attractive financially but also complicates the broader government initiative aimed at reducing carbon emissions by encouraging EV adoption.
If public charging remains significantly more expensive than home charging, it could deter individuals, particularly professional drivers, from transitioning to electric vehicles, thereby slowing progress towards environmental targets.
