Taxation (Energy and Vehicles) Bill Committee

Bill to protect families from energy crises passes all Commons stages

On Wednesday 1 July 2026 the House of Commons considered the Taxation (Energy and Vehicles) Bill.
The conflict in the Middle East has exposed British families and businesses to volatile gas prices making things more expensive. This Bill responds directly to these pressures. 

The Bill will increase the rate of the Electricity Generator Levy from 45% to 55% from 1 July 2026. Legacy renewable energy generators stand to financially benefit from higher gas prices without incurring any new costs or risks. The levy already recoups some of these excess returns, but the rate rise will ensure that more of these revenues are passed back to the public purse so that money is available to support businesses and families. At the same time, it excludes new investment so as to not deter future clean energy development.

The rate of Approved Mileage Allowance Payments will be increased from 1 April 2026, in recognition of the pressures facing drivers as a result of the conflict. People making business journeys in their own vehicle will receive greater reimbursement, an increase to 55p from 45p for the first 10,000 miles and 25p thereafter. This will benefit around two million employees, one million self-employed individuals, and save over £120 a year for a worker doing 6,000 business miles.

Additionally, the Bill introduces a temporary 12-month Vehicle Excise Duty exemption for certain heavy goods vehicles from 1 July 2026 to 30 June 2027. The road haulage sector plays a key role in transporting goods across the UK and is disproportionately exposed to fuel costs. This will save a typical HGV £600.

These amendments were put to the vote: 

Taxation (Energy and Vehicles) Bill Committee: New Clause 2 – Ayes 80 and Noes 281
Taxation (Energy and Vehicles) Bill Committee: New Clause 4 – Ayes 173 and Noes 282
Taxation (Energy and Vehicles) Bill Committee: New Clause 5 – Ayes 177 and Noes 308

The Bill passed all its House of Commons stages without amendment and proceeded to the House of Lords.