Wed, 26 Nov 2025

Wed, 26 Nov 2025 Electric vehicle owners to face pay-per-mile tax

Drivers of electric cars will pay a road charge of 3p per mile, while plug-in hybrid drivers will pay 1.5p per mile from April 2028.
The government's independent forecaster, the Office for Budget Responsibility (OBR), estimates that the tax will bring in £1.1bn in the 2028-29 financial year and rise to £1.9bn by 2030-31. However, the actual amount raised is uncertain due to factors such as electric car sales. The new tax has been met with criticism from the automotive industry, with Ford and the Society of Motor Manufacturers and Traders (SMMT) saying it's "the wrong measure at the wrong time". The Renewable Energy Association described the tax as a "knee-jerk" charge. Mileage readings will be based on in-vehicle odometers, which can be tampered with. The government is consulting on how to implement the scheme and mitigate potential issues such as clocking. All new cars will have to be electric or hybrid from 2030, when a ban on the sale of new petrol and diesel cars comes into force. However, some argue that this new tax could make electric cars less appealing. The government also extended the 5p cut in fuel duty until September next year, after which it is set to increase annually by the RPI measure of inflation.
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