Britain's new PM to cut taxes on electricity bills

Britain's newly appointed Prime Minister Andy Burnham delivers a speech outside 10 Downing Street after taking office, in London, Britain, Jul 20, 2026. REUTERS Tag: Andy Burnham, UK, electricity bill, VAT

The government of new British Prime Minister Andy Burnham will cut taxes on electricity bills, Downing Street said in a statement on Tuesday, as he attempts to deliver on his promises to ease a cost-of-living crisis.

The British government is planning to remove the value-added tax (VAT) from domestic electricity bills from Oct 1, the statement said.

The cost of this action for this financial year will be funded from the cancellation of the government's £1.8 billion ($2.42 billion) digital ID programme, Downing Street said.

Burnham's office had said earlier that one of his first moves as Britain's next leader will be to scrap government plans for a digital ID scheme.

The digital ID programme is a plan for all employees to hold a digital identity document, a scheme designed to tackle illegal migration but deemed a "fiasco" by a cross-party committee of lawmakers.

As Britain's new Prime Minister, Burnham wants to move quickly to show British politics can work and improve living standards after years of stagnation.

“Westminster has not been working for people for too long, with families struggling with the cost of living," Burnham said.

“That needs to change," he added.