A UK tax tribunal has ruled that public electric vehicle (EV) charging should attract the reduced 5% domestic VAT rate rather than the current 20% standard rate paid by drivers.

The case against HMRC’s long-standing position was brought by community charge point operator Charge My Street with support from tax specialists at Deloitte.

Deloitte argued that existing VAT legislation already provides for electricity supplies of less than 1,000kWh per month at a single premises to qualify for the reduced domestic rate – a threshold they said would be almost impossible for an individual EV driver to exceed at one public charge point.

In its decision, published this week following a hearing in October, the First-tier Tribunal agreed. It concluded that the 5% rate applies in circumstances where monthly usage per customer at a given location remains below 1,000kWh, dismissing HMRC’s interpretation of the rules.

Oliver Jarratt, VAT specialist at Deloitte Legal, described the outcome as a decisive win, while Daniel Heery, director at Charge My Street, said the judgment would improve fairness and strengthen the business case for expanding community-based charging. Lower VAT, he noted, would help make neighbourhood EV charging more affordable and support further investment in local infrastructure.

Reacting to the ruling, Lorna McAtear, deputy chair of the Association of Fleet Professionals, said that while the full implications are still unfolding, the decision could mark meaningful progress toward the organisation’s long-standing objective of reducing VAT on public EV charging.