Cost-of-living crisis: SNP MSP calls for VAT reduction to energy bills

An SNP MSP has called on the UK Government to introduce a reduction of VAT on energy bills to help those struggling to pay due to the cost-of-living crisis.

Christina McKelvie said the £200 ‘loan’ from the Treasury should be delivered as a grant instead and said further interventions from the Treasury should follow.

The Treasury said its support was worth £20 billion and the £200 on energy bills would allow people to spread the cost of the high bills being felt today.

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An SNP MSP has called on the Scottish Government to do more for people suffering from the cost of living crisis.

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The MSP for Hamilton, Larkhall and Stonehouse helped facilitate the launch of the ‘quick credit voucher’ in her constituency, helping people referred to foodbanks meet the cost of energy through a non-repayable credit voucher.

She said: “Households across Scotland have been struggling with energy prices before this new hike from Ofgem has even been implemented. Working with Scottish Power and the Fuel Bank Foundation I have seen first-hand the impact fuel poverty has in my constituency, particularly on the most vulnerable households.

“If [Chancellor] Rishi Sunak had seen these schemes in operation, then he might understand one of the key principles of it – making people pay back emergency funding simply does not help lift them out of poverty.

“Receiving £200 now which will have to be paid back while households are being squeezed through energy hikes, a rise in national insurance and general cost-of-living crisis is little help at all.”

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Ms McKelvie also called on the Chancellor to implement a reduction of VAT on energy bills, something she said would be a “lifebelt for struggling families” and was a promised “benefit of Brexit”.

A spokesperson for the Treasury said the Scottish Government had the biggest funding settlement since the beginning of devolution to help support struggling families.

They said: “We recognise the pressures people are facing with the cost of living and are providing support worth around £20bn across the UK this financial year and next to help.

“The energy bills’ reduction is not a loan to households or suppliers and will help people manage the increase in energy bills by spreading the increased costs over a few years, so they are more manageable and we have provided £290 million for the Scottish Government through the Barnett formula as a result of the council tax rebate scheme."

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