UK prime minister scraps VAT on electricity bills from October

The measures will be funded by winding down the government's Digital ID programme. It is expected to reduce the annual electricity price cap by £45 (US$60) and trim consumer price inflation by 0.1 percentage point.

21 Jul 2026 07:39pm
Britain's new Prime Minister Andy Burnham gives his first speech in front of 10 Downing Street in central London on July 20, 2026, after being asked by the king to form the next government. (Photo by HENRY NICHOLLS / AFP)
Britain's new Prime Minister Andy Burnham gives his first speech in front of 10 Downing Street in central London on July 20, 2026, after being asked by the king to form the next government. (Photo by HENRY NICHOLLS / AFP)

MOSCOW - New United Kingdom (UK) Prime Minister Andy Burnham has scrapped the value-added tax (VAT) on electricity effective October, his office said on Tuesday.

"Government is tackling rising bills with a tax cut to remove VAT from domestic electricity bills from October 1 in time to impact the next Ofgem price cap,” the statement read.

The measures will be funded by winding down the government's Digital ID programme, the statement added.

It is expected to reduce the annual electricity price cap by £45 (US$60) and trim consumer price inflation by 0.1 percentage point.

On Monday, Burnham officially assumed office as the new UK prime minister.

Burnham pledged in his first address from Downing Street to deliver the "biggest changes" in UK politics and the economy in four decades. - BERNAMA

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