House of Commons · General Debate
24 June 2026 · 5 other contributors
Opened by Dan Tomlinson Lab Constituency
Summarised by AI from the official record, so it can contain mistakes.
Dan Tomlinson raised concerns about taxation (energy and vehicles) in the House of Commons. A government minister responded. Other MPs also contributed.
Key points
MPs spoke in turn to share their views and ask questions. Here's what each person said.
Opened the debate
Moves provision may be made to increase the rate of the electricity generator levy to 55%. This motion seeks to address the rising costs faced by households and businesses, particularly in relation to energy bills. The proposal aims to weaken the link between electricity and gas prices.
Introduces motions for income tax mileage allowance adjustment from 45p to 55p per mile, and a temporary reduction in vehicle excise duty for HGVs. The amendments aim to provide fiscal relief during the transitional period and address public interest expedience as outlined by the Provisional Collection of Taxes Act 1968.
Asks questions regarding the Treasury's estimate of revenue from the increased electricity generator levy, feedback on industry investment impacts, and uncertainty around the temporary nature of these measures. Also inquires about future indexation for mileage allowance rates and behavioural analysis concerning vehicle excise duty reduction.
Welcomes the proposed increase in electricity generator levy and the adjustment to mileage allowance, emphasising positive outcomes such as lower energy bills for constituents and recognition of inflationary pressures on fuel costs. Also acknowledges support provided by the temporary reduction in vehicle excise duty.
The electricity generator levy is a windfall tax on UK electricity generation, raised £0.7 billion in the last financial year. Charlie questioned how much revenue the new higher rate would raise with current market conditions and supported the goal of funding cost-of-living support through emergency measures but noted power wholesale prices have stabilised. He also recognised that this measure encourages renewable generators to shift towards fixed contracts for difference, which benefits consumers by insulating them from future gas price spikes. Charlie further discussed the proposed increase in mileage allowance rate, highlighting its inadequacy due to accumulated inflation over 15 years and called for clarity on cost estimates. Finally, he welcomed the HGV VED holiday but urged a more comprehensive plan addressing long-term challenges faced by hauliers.
Responded to points raised about the electricity generator levy and mileage allowance increase. Acknowledged that the OBR will provide an estimate of how much this change will raise and noted that investment in new projects is excluded from the levy, thus not discouraging new investments. Explained that a review on whether the higher rate should be permanent or temporary was under consideration by the Chancellor and Energy Secretary. He also justified the decision to leave the 25p rate unchanged for distances above 10,000 miles due to the declining marginal cost of each extra mile driven over time.
Government Response
Responded to points raised about the electricity generator levy and mileage allowance increase. Acknowledged that the OBR will provide an estimate of how much this change will raise and noted that investment in new projects is excluded from the levy, thus not discouraging new investments. Explained that a review on whether the higher rate should be permanent or temporary was under consideration by the Chancellor and Energy Secretary. He also justified the decision to leave the 25p rate unchanged for distances above 10,000 miles due to the declining marginal cost of each extra mile driven over time.