Island following UK in applying cut
Following the UK's lead and removing the five percent VAT rate from electricity bills will cost the Manx Government around £1 million to the end of the current financial year.
The treasury minister has ruled out the Island breaking ranks with its larger neighbour and says the cut, introduced by Prime Minister Andy Burnham, will be passed on to Manx consumers.
Calculations in the UK suggest the average household will save around £45 as a result.
The change will come into effect on 1 October and will extend to small businesses that qualify for domestic energy VAT relief and are not VAT registered, as well as eligible charities and residential care homes.
Chris Thomas says there is some flexibility in the customs agreement:
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