Former chancellor Rishi Sunak who is now in the running to be the next Prime Minister says he will scrap VAT on energy bills. Mr Sunak's U-turn could mean Brits would save up to £160 on their bills as the price cap looks set to soar to £3,500.
The scrapping of the 5% charge was, at one stage, not on the cards as Mr Sunak argued his case against it. Estimations suggest the move would save homeowners around £156 each year but cost the treasury more than £4 billion.
It comes as money savings expert Martin Lewis warned again of soaring energy prices. He said: "The latest spike in year-ahead wholesale price means the [October] cap prediction is now up 78% (so £3,500/year on typical bills) and likely up again in January. It will be desperate. Intervention needed."
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The Labour Party had been pressing for a VAT cut. The pledge for further support also comes as inflation continues to rise above 9%, with expectations it could hit 11% before the year is out.
When he was the chancellor, Mr Sunak promised a £400 discount on bills this winter, as well as a £650 payment (paid in two instalments) for those under the most intense financial constraints. Further support was also promises for pensioners as well as benefit claimants.
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