Wolverhampton MP urges government to cut VAT on energy bills

Rishi Sunak will unveil his Spring Statement tomorrow and Mr McFadden says hard pressed households should be at the forefront of his mind.

He has suggested that Ministers could also place a one off windfall levy on the profits made by oil and gas companies, instead of taxing workers and small businesses.

The conflict in Ukraine has also driven up the cost of fuel prices.

"There was a cost of living crisis before the first Russian soldier set foot in Ukraine, and the past few weeks has made it worse – forcing fuel prices to record highs and bringing predictions of another sharp rise in energy prices on top of the £700 a year rise already baked in for April," said Mr McFadden.

"On top of that food prices are expected to rise as wheat supplies from Ukraine – often regarded as the breadbasket of Europe – are disturbed.

"Inflation is spiralling with estimates it could reach eight per cent or more in the coming months.

"All of this adds up to the sharpest squeeze on living standards we have seen for decades.

"Households face a triple whammy of rapidly rising prices, Tory tax rises and wages failing to keep pace."

He says the Government needs to take action, adding: "The Government could ease the cost of living crisis by cutting VAT on energy bills with extra help for those on the lowest incomes. "And instead of taxing workers and small businesses, ministers could place a one off windfall levy on the huge profits being made by the oil and gas companies right now.

"That would be a fair way to proceed and it would get more help to those who need it. It’s the kind of plan Labour has been advocating for months.

"The chief executive of BP described the current energy market as a cash machine for his company.

"In this case it is time some of that cash went to people trying to cope with rocketing bills rather than them face a National Insurance increase that will make their position even worse."