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VAT rate to be cut from electricity bills in line with UK

Picture credit: Pixabay

Measure to take effect from October

The VAT rate on domestic electricity bills on the Island is to be cut from 5 percent to 0 percent in line with the UK.

The policy, announced by the new UK Prime Minister Andy Burnham yesterday (21 July), will take effect from 1 October.

The Isle of Man is obliged under the Customs and Excise Agreement to maintain the same VAT rates as the UK.

Government says the cut in the rate will extend to small businesses that qualify for domestic energy VAT relief and are not VAT registered; those where electricity consumption is below an average of 1,000 kWh per month.

It will also be extended to eligible charities and residential care homes. 

We're told we can expect further details on the measure in due course.

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