The Court of Justice of the European Union (ECJ) has concluded that the UK’s reduced VAT rate for supplies concerning energy-saving materials (Items 1 and 2, Group 2, Part 2, Schedule 7A, Value Added Tax Act 1994) infringes Council Directive 2006/112/EC of 28 November 2008. In Commission v United Kingdom (Case C-161/14) the ECJ held that the reduced rate should only apply to supplies that are not “social policy”. The UK must now decide what constitutes “social policy” and standard-rate supplies that do not satisfy this requirement.