As the UK focuses on plans to achieve net zero status, Andy Bradford, associate partner, indirect tax, at EY argues the case for shaping VAT policy to reflect sustainability targets and change buyer behaviour
The Chancellor’s Autumn Budget highlighted the need to move the economy on from the effects of Covid-19 and began to explore new opportunities to change the tax regime following Brexit. Together with HMRC’s aspiration to move towards real-time reporting by 2030, we are starting to see a possible vision for the future of tax.
All this means there is a big decade ahead for the UK’s VAT system and an opportunity to help shape the way forward. One of the key developments is likely to be the opportunity for UK VAT policy to be used to help drive the environmental and sustainability agenda.
The UK government has a commitment to bring all greenhouse gas emissions to net zero by 2050 and as world leaders convened from 1 November for the UN Climate Change conference (COP26) it is clear that climate protection is at the forefront of world leader’s minds.
