VAT could no longer be payable on the Severn Bridge tolls once the crossings revert to public ownership in 2018.
Monmouth MP David Davies says he's been given written confirmation from the Transport Minister.
In his letter, the Minister states that once the concession ends - expected to be in 2018 - it would be legally possible to reduce tolls on both the M48 Severn Bridge and M4 Second Severn Crossing.
However, the future management and tolling arrangements of the crossings remains unclear as the UK Government has yet to announce what action will be taken after the current concession ends.
Mr Davies said, “We must now demand a clear plan for the post concession period with a significant reduction in the tolls,” he added.