By Daniel Hunter

With the Budget approaching, there are renewed pleas for the Chancellor George Osborne to cut the rate of VAT in a move that will move thousands of people out of fuel poverty.

Danny Jatania, a consumer champion and CEO and Chairman of Pockit, has written a letter to the Chancellor about this issue. In it he points to the failure of previous initiatives introduced to eradicate fuel poverty and petitions for swift action, as many of the UK’s households struggle to pay their bills. He suggests introducing zero-rate VAT on all household energy bills as well as introducing a simplified tariff structure to help customers switch to better deals.

Writing to the Chancellor, he said, “I am all too aware of the strain that rising energy bills are placing on the people of the UK. In order to address this predicament we find ourselves in, decisive action must be taken, starting with the upcoming budget announcement.”

With many of the Big Six energy companies announcing large profits in recent weeks, Danny has been one of the voices calling for the energy market to become more consumer-friendly. Currently, prices are high and there are predictions that further price hikes are on the way. However, many householders feel powerless to switch to a better deal. He argues cutting VAT and helping the market to become more competitive would rescue 250,000 households from fuel poverty.

In addition, Danny argues that a windfall tax on the profits of the energy companies could help plug the gap left by the VAT cut and could also be invested in household energy efficiency measures.

He said, “Competition in the energy market and the growth of independent firms can help to drive down prices and make the customer the focus once more. The energy market is far too complicated and the government must help Ofgem to make it easier for consumers to find the cheapest deals.”

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