- Labour Planning Parliamentary Bid to Overturn Tax Increase
- Tax on solar panels would quadruple following EU ruling
At least 16 U.K. Conservative Party lawmakers plan to rebel against government plans to raise sales tax on solar panels and insulation materials, taking a stand against measures imposed by the European Union.
The lawmakers, including Euro-skeptics Graham Brady, Bernard Jenkin, Edward Leigh and Jacob Rees-Mogg, are supporting an amendment put forward by the opposition Labour Party to the government’s budget resolution. It would strike down the increase in value-added tax on energy-saving and low-carbon energy products to 20 percent from 5 percent.
Prime Minister David Cameron, whose Conservatives have a majority of 17 in the 650-member House of Commons, already averted one backbench rebellion on Thursday by securing backing from other EU leaders to exempt tampons from VAT. Some Tory lawmakers are also unhappy at budget plans to cut benefits for the disabled. The tax increase on solar panels was touted by proponents of a British vote to leave the EU, a so-called Brexit, as another example of meddling by the 28-nation bloc in domestic affairs after it was mandated last June by the European Court of Justice.
“I for one will be opposing this measure, as I do not wish to see energy conservation taxed in this way and object strongly to the erosion of our taxation powers by the European Court,” John Redwood, another Conservative Euro-skeptic and former minister, wrote in a blog post. “It will be interesting to see who will vote with us in opposing this needless and undesirable tax increase.”
Labour is seeking a parliamentary vote on the solar amendment on Tuesday. Nine Tory rebels would be enough to defeat the government if all opposition parties voted for it. Other Conservative backers include Stewart Jackson, Peter Lilley and Anne-Marie Trevelyan.
The tax change would add nearly 1,000 pounds ($1,400) to the cost of installing a typical domestic solar-power system, Labour said Friday in an e-mailed statement.
“If this tax rise goes ahead, we’ll be in the perverse situation that fossil-fuel energy is being taxed at a lower rate than the renewables which save jobs, save money and save the environment,” said Clive Lewis, a party spokesman on climate change and energy.
Amending the budget resolution is an “unusual parliamentary tactic last used successfully in 1994,” Labour said in its statement, referring to action taken by Labour’s then finance spokesman, Gordon Brown, to defeat the government of Tory Prime Minister John Major over plans to raise sales tax on domestic fuel.
“Parliament is right to recognize a serious problem with the government’s treatment of solar power, which had been the major clean-energy success story of the last Parliament,” Paul Barwell, chief executive officer of the Solar Trade Association industry group, said in a statement.