MPs are calling on Rishi Sunak to ramp up efforts for green investment.
There is pressure on the Chancellor to be more ambitious in terms of the environment and that the current climate plans are not enough.
MPs on Parliament’s Environmental Audit Committee have presented a set of guidelines on how Sunak can do more for the climate, for example introducing an economy-wide carbon tax.
One of the major measures that people want to see is a VAT reduction for environmentally friendly products.
Chief executive of renewable energy supplier Bulb said: “Making low carbon products and green technology cheaper will provide a welcome cash boost for hard-pressed families. For example, cutting VAT [to zero] would reduce the cost to consumers of a Honda E, a mass-market pure EV, by over £4,500, making it more affordable for drivers to switch away from petrol and diesel vehicles ahead of the 2030 ban that the government has announced.”
Sunak will deliver the budget on March 3 where MPs are hoping for a push in green jobs and decarbonising industries.
Committee chair Philip Dunne said: “It is a symptom of a growing ecological emergency. The economic recovery will shape our national economy for decades to come, and it is crucial that tackling climate change and restoring nature is at its core.
“A tax system fit for net-zero Britain is key. It will encourage innovation, give confidence to the sector and support companies to make the low-carbon transition.
“There are endless initiatives that can lead to a greener future and the Chancellor should use his upcoming Budget statement to start this process. Boosting energy efficiency of homes by reducing VAT on retrofits can spur growth in low-carbon manufacturing.
“The funding allocated to the Green Homes Grant should be rolled over to meet the target to issue 600,000 vouchers. The electric vehicle transition must be accelerated with further tax incentives to encourage take up,” he added.