Reinstate EV grant and cut VAT on public charging, say Lib Dems

The Liberal Democrats have launched their manifesto for the 2024 general election and it promises the return of the plug-in car grant for electric car buyers. Alongside this the Lib Dems want more easily accessible and cheaper EV charging, as well as a crackdown on potholes, sky-high car insurance and rising fuel prices.

The Lib Dems’ focus on electrifying our roads centres around the reinstatement of the 2030 ban on the sale of new petrol and diesel-powered vehicles, which was recently extended to 2035 by the Conservative government. 

To entice private drivers into EVs, the Liberal Democrats say they’ll reinstate the plug-in car grant. This taxpayer-funded incentive was discontinued in June 2022, but previously provided EV buyers with £1,500 (down from the original £5,000) towards the price of a new electric model.

The Lib Dems have also pledged to improve the effectiveness of the UK’s charging network. The party says it will vastly upgrade the National Grid in order to facilitate the rollout of more EV chargers, “including residential on-street points and ultra-fast chargers at service stations”. 

Also on the Lib Dems agenda is cutting VAT on public charging to just five per cent, bringing it in line with the VAT cost of charging at home. Currently, drivers pay 20 per cent VAT when using public charging, with the average cost per kilowatt-hour for an rapid/ultra-rapid charger (those that charge at speeds of over 50kW) sitting at around 80 pence. Such a cut in sales tax would bring this figure down to 68 pence per kilowatt hour, saving drivers roughly the equivalent of £4.30 for a typical 20-80 per cent top-up of the UK’s best-selling EV, the 60kWh Tesla Model Y RWD.

Other motoring-related pledges by the Liberal Democrats include fixing the UK’s current pothole problem – more budget and power will be allocated to local authorities to solve this issue – and protecting motorists from what the party refers to as “rip-offs, including unfair insurance and petrol prices”, although details of how they intend to do that are not provided in the manifesto.

So how much will this all cost? The Lib Dems say the total damage to the taxpayer is around £600 million, suggesting its ambitions are limited. The road-building industry estimates that £16 billion is needed to fix Britain’s roads, while the previous plug-in grant cost the government £1.6 billion over the course of its run between 2011 and 2022.

The Lib Dems will find their £600m, according to the manifesto, from levies on the big banks which they say will pour an extra £4 billion into the country’s coffers. More money will also come from a reform of capital gains tax, a tax on frequent flyers and a crackdown on tax avoidance schemes.

The Liberal Democrats are the second of the main seven parties to announce their manifesto for 2024; the Green Party announced its pledges for this year’s election last week, with the Conservatives, Labour, Reform UK, SNP and Plaid Cymru all set to announce their visions for the nation later this week.

Want the latest car news in your inbox? Sign up to the free Auto Express email newsletter...