VAT cut to be applied to Manx electricity bills
Summary
The Isle of Man government will reduce the VAT on domestic electricity bills from 5% to 0%, starting in October until March 2027. This change matches a similar UK policy and aims to help households save money on energy costs.Key Facts
- VAT on domestic electricity bills on the Isle of Man will be cut from 5% to 0% starting October 1, 2024.
- The VAT cut will last until the end of the 2026-27 financial year (March 2027).
- A typical household could save about £50 per year on electricity bills due to this change.
- The Isle of Man government expects VAT revenue loss of between £1 million and £1.4 million during this period.
- The reduction follows the UK’s recent VAT cut on electricity to ease cost-of-living pressures.
- The Isle of Man maintains the same VAT rates as the UK under the Customs and Excise Agreement.
- Small businesses that use less than 1,000 kWh per month and are not VAT registered, charities, and residential care homes will also benefit.
- Manx Utilities is responsible for the electricity supply and communicated the expected savings.
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