Written Question·Treasury·UIN 70024

Carbon Emissions: VAT

Tabled: 22 July 2025
Answered: 4 September 2025

Question

Edward Morello

Liberal Democrat — West Dorset

To ask the Chancellor of the Exchequer, if she will make an assessment of the potential impact of charging VAT on carbon offset donations on levels of public engagement with climate action.

Answer

Dan Tomlinson
Payments that are freely given without the expectation of receiving something in return are not in the scope of VAT. This is a fundamental principle of how VAT operates. Donations made to carbon projects are outside the scope of VAT. This means that VAT s...
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