UK energy companies have been told to pass on savings to consumers cutting back their usage.
Business Secretary Grant Shapps said he was disturbed by reports of bills going up despite customers trying to be frugal.
This can happen if suppliers overestimate usage from households who pay a monthly direct debit.
In a letter to suppliers, Mr Shapps told them to explain how they would prevent this from happening.
“It is in all our interests that when consumers take sensible steps to reduce their own bills, such as reducing their boiler flow temperature or making their homes more energy efficient, that they are able to see an impact in their bills,” Mr Shapps wrote.
“I am very keen that all suppliers find a way to make their systems more responsive to these positive changes in consumer behaviour.”
Household energy bills are up by 27 per cent amid a gas squeeze blamed by ministers on Russia’s invasion of Ukraine.
Unlike many European countries, Britain has set no formal targets for households to cut demand.
But an energy campaign is believed to be in the works in which people will be urged to turn thermostats down by 2ºC this winter.
Mr Shapps said some consumers were making “huge efforts to reduce their usage to save money at a time when household incomes are squeezed”.
A freeze on energy bills at a typical £2,500 ($3,020) per year until April is expected to cost the government about £38 billion ($45.95bn).
As ministers try to increase long-term energy supplies, a row is brewing among Conservative MPs over whether to turn to onshore wind farms.
Mr Sunak promised to block onshore wind in the summer leadership campaign, in a play to the party’s homeowning base.
But former prime ministers Boris Johnson and Liz Truss are among the Tory MPs said to favour more wind farms.
A former minister in both their governments, Simon Clarke, wants to amend a regional development bill to lift a ban on onshore wind.
“If you want to know why we should have more renewables, just look at your gas or electricity bill,” former party chairman Jake Berry told the BBC’s Sunday with Laura Kuenssberg programme.
The opposition Labour Party has signalled it could back the amendment to pile pressure on Mr Sunak.
The Prime Minister has also reinstated a ban on fracking, after Ms Truss briefly moved to resume shale gas extraction.
The specs
Engine: 3.8-litre twin-turbo flat-six
Power: 650hp at 6,750rpm
Torque: 800Nm from 2,500-4,000rpm
Transmission: 8-speed dual-clutch auto
Fuel consumption: 11.12L/100km
Price: From Dh796,600
On sale: now
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
