You are being ripped off with your energy bills, but by Government, not the energy companies. (Though the later aren’t exactly playing nice either!)
The Government takes more in tax from your energy bills than the energy companies take in profit. On average 3.6% of your gas and electricity bill will go in profit to the Big 6 energy companies, while 11% for gas and 16% for electricity will go to the Government in taxation. This means energy taxes cost the average family (or student house..) around £200 a year.
A proportion of these (~9%) are the so called ‘Green Taxes’ which of course are not green at all. They do almost nothing to help the environment – reduction in energy consumption caused by people no longer being able to afford to heat their homes is something I think we can all agree that is not a price worth paying. Of course some will say “oh, but the money is used to fund green jobs and investment etc”. Not really. Just like other taxation most is just swallowed up into the colossal black hole that is Government finances, and when funds are used to subsidise cavity wall insulation or whatnot remember that it was the poor bugger struggling to pay his bills who was forced to pay for it! We are not going to counter climate change off the backs of the poorest.
It’s not just your household energy bills either. When you fill up your car at the petrol station, how much of the final amount you pay do you think is tax? 10%? 20? 30? Nope. It’s a whopping 60%. That means when you fill your car up with £30, only £12 of that is actually going towards the fuel, the rest goes straight to the taxman. It’s a scandal, but one we seem to be overlooking.
And this is all set to get worse, as environmental lobbyists and EU regulation mean green taxes are set to soar in the future.
Yesterday, Labour Lords were only narrowly defeated on the 2030 decarbonisation target plans to add ANOTHER £125 in taxes to your bills.
Thankfully there is a welcoming sign emerging from the depths of Westminster – David Cameron has hinted that he intends to reduce energy taxes in response to Ed Milliband’s promise to freeze bills. Cameron should go the whole way and zero rate all energy from taxes.
So as we all jump on the Big 6 bashing band wagon, lets just remember who really drives up our bills.