Seven in 10 say VAT cut won’t ease cost of living pressures, poll finds
The Government plans to remove the 5% VAT charged on household electricity bills from 1st October 2026 for six months.
Nearly three quarters (72%) of adults believe scrapping VAT on household electricity bills will make little or no difference to their finances, despite almost half supporting the policy in principle, according to research from Opinium.
The poll found 49% supported the proposal, while just 8% opposed it.
However, most respondents said the measure would have little impact on their household budgets.
The Government plans to remove the 5% VAT charged on household electricity bills from 1st October 2026 for six months, with ministers estimating a typical household would save around £45 a year.
Younger adults were the most likely to believe the measure would improve their finances.
Around two in five (39%) people aged 18 to 34 said the VAT cut would help, compared with 24% of those aged 35 to 49 and just 6% of people aged 50 and over.
The research also found that 52% of UK adults believed increasing the tax-free personal allowance in line with inflation would leave them better off.
Support was strongest among older and higher-income respondents. Nearly two thirds (64%) of those aged 65 and over thought they would benefit, alongside 65% of people with household incomes above £100,000.
By contrast, opinion was divided over replacing Council Tax and Stamp Duty with an annual property value tax.
Around 23% believed they would be better off under such a system, while 22% thought they would be worse off.
A further 27% said it would make no difference and 27% were unsure.
Higher earners and homeowners were more likely to expect to lose out.
Nearly half (46%) of those with household incomes above £100,000 said they would be worse off, compared with 28% of homeowners overall.
Matthew Howlett, research manager at Opinium, said: “Our research shows that the public broadly supports the Government’s decision to remove VAT from household electricity bills, but most people don’t expect Burnham’s first major economic announcement to make much difference to the cost-of-living.
“As the new Prime Minister and Chancellor look ahead to their first Budget in October, a majority of voters think that unfreezing the tax-free personal allowance would have a significant impact on their finances.
“By contrast, the public is much more divided over rumours about replacing council tax and stamp duty with a proportional property tax, with large numbers unsure how the change could affect them.”
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