Reeves to Hit EVs With £250 Pay-Per-Mile Tax
Electric vehicle drivers will be hit with a new pay-per-mile tax in the Budget, with a new charge of 3p per mile being levied on top of other road taxes, costing the average driver an extra £250 a year. The Telegraph has more.
Under current plans, to be announced by the Chancellor on November 26th, drivers of electric cars will be charged 3p per mile on top of other road taxes.
The scheme, set to kick in from 2028 after a consultation, will mean the average driver faces paying an extra £250 a year.
The Treasury will make the move amid falling fuel duty revenue as people move from petrol to electric cars. Up to six million people are set to be driving EVs by the time the tax comes in.
Ministers will frame the move as one of fairness, as drivers of petrol cars currently pay £600 a year on average in fuel duty.
They will also argue that it is different from traditional pay-per-mile schemes, with a fee taken each year on estimated travel and no mass electronic monitoring of movements.
But the approach opens the door for the wholesale adoption of pay-per-mile taxation for all cars, raising questions about how the scheme would be enforced.
Sir Mel Stride, the Conservative Shadow Chancellor, said: “If you own it, Labour will tax it. It would be wrong for Rachel Reeves to target commuters and car owners in this way just to help fill a black hole she has created in the public finances.
“With Labour’s cost of living crisis, now is not the time to hit hard-working families and businesses with another tax raid.”
For years, ministers and industry experts have discussed a pay-per-mile road taxation system that could be applied to all forms of cars.
While the specifics are still discussed, the Telegraph can reveal that the scheme would be aligned to the annual payment of vehicle excise duty (VED), which affects all UK motorists. EV drivers have had to pay the charge since April.
The new element is being described as ‘VED+’ and being framed as a way to get drivers of green cars to pay more each year.
EV drivers will be asked to estimate the number of miles they will drive in the year ahead and pay a fee, set in the current plan at 3p per mile.
If the owner does not drive that amount, some of the money carries over into the next year. If they drive more miles than estimated, they would top up their payment.
Worth reading in full.
Losing their road tax exemption in April and now a new tax all of their own – the perks of the early EV adopters are fast being withdrawn.
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EV drivers are also subject, of course, to all the green taxes that artificially inflate our electricity bills. It’s surely only a matter of time before pay-per-mile is applied to all vehices operating within Khanistan’s ULEZ, as the vehicles currently being targeted disappear from the roads due to old age.
https://www.instagram.com/reel/DQryn9VDAR8/?igsh=dmIycTQ1cnE0Y2tp
A way around it….
Without me having to Google it but is this true? Private jets don’t pay fuel tax???
It is varied, depending on country for instance. Often private international flights are fuel tax exempt. There are calls to change this.
Clearly only justifiable, if at all, on EVs. ICE vehicles already pay duty and VAT for fuel that cannot be evaded (except by those who use red Deisel – a growing number, I understand).
Hahaha hahaha!!
Hahahahahahaha!!
Sorry, I just can’t stop laughing.
I feel for the poor suckers that bought electric cars believing the BS that they would be cheaper.
Actually, I’m lying. I don’t feel for them at all. Not one bit.
Yes. You’d have to have a heart of stone not to laugh!
I confess to being one of those Muppets who was lucky enough to drive a company car when Gordon Brown was chancellor. An excellent petrol powered car came to the end of its contract and a like for like replacement was far too expensive because the tax had ballooned. A diesel was chosen and almost immediately I was the devil incarnate because, even though it achieved all of the Euro emissions standards, it was apparently pumping out such noxious chemicals that I was literally wiping out the population of every town I visited. The tax on diesel and over demand across Europe saw the price soar and the personal benefit in kind tax on the car wiped out the savings on a petrol. Socialist governments have always conned the population to choose the better solution only to rip them off a few years later
Diesel is worse for our lungs than petrol Everyone knows that and so did Gordon Brown and his government. But ideology as usual trumps every bit of common sense or concern for people health and they decided to give tax relief to diesel because it had less CO2 emissions. The phony planet saving agenda is not just evidence free absurdity it is anti human.
Fuel duty is 52.95p per litre. VAT is charged on top making it up to 63.54p per litre in tax. Our car averages 9.2 miles per litre (I keep detailed records). So the tax on fuel is a hair over 6.9p per mile for us – on top of VED etc.
Has anyone got the corresponding info for charging and running an EV?
You forgot VAT on the wholesale cost of the fuel – crude, refining, distribution, wholesale margin, 59.8p.
So the tax on a litre of petrol, Excise, and VAT is about 112.5p. Wholesale price, 59.8p, Excise duty, 52.95p and on these, VAT 22.5p.
That means fuel tax for your vehicle per mile is 12.22p.
The problem with calculation per mile cost for a BEV, is it will depend on battery condition, ambient temperature, use of a/c and other on-board electrics, do they use a roadside charger on fast-charge or standard-charge, do they charge overnight at home, the number and frequency of discharge/recharge cycles which degrade the battery.
Estimates are available, but really only take into count cost of electricity per kWh usually for a hole charger, range of vehicle, nominal storage capacity of the battery and a bit of simple maths. This usually results in ridiculously low cost per mile.
I don’t dispute the overall tax burden. VAT is charged on many things whether ‘Value’ is ‘Added’ or not. However, ‘Fuel Duty’ is a specific tax on fuel for running road vehicles. It’s suspended for agricultural uses. The fact that VAT is charged on fuel duty (where is the value added?) is surely nuts and purely a road tax measure which charges ordinary folk more if they drive more miles.
To address just one of your specific points: I get fewer miles per litre of petrol if I have the air-con on, or if I drive with a heavy right foot. Just like an EV driver will get fewer miles per kWh. How ‘they’ will actually charge so many pennies per mile is beyond my understanding. Certainly charging me the same number of pennies per mile as someone with a 3 litre Jag does not seem equitable… but that’s mostly because I can’t imagine myself owning a 3l Jag.
When you do the sums about petrol, if you add up all the costs associated with extracting oil, getting it to refineries, refining it, getting it to the petrol station, a bit of profit for the station owner, plus duty and VAT, even if crude oil were free, petrol would still cost about 90p-£1 per litre.
As JXB points out above that is not ‘the tax on fuel’ but only the fuel duty. There are additional taxes on fuel.
It strikes me that a pay per mile tax on BEVs should be around 7p/mile – not 3p/mile. How you do that is fortunately somebody else’ problem.
But it does pay for the best road network in the entire World – allegedly.
As noted elsewhere, look out for entrepreneurs devising speedo photo scams.
I assume they’ll just use their surveillance camera network to work out where people have been and how much they owe. They’ll also be able to cross-reference with MOT certificates which are now kept on a central digital database.
MOTs don’t apply for 3 years. Software development will probably cost more than revenue.
They would have to also charge when a vehicle changes hands.
We’ve been observing the sales of EV slow down considerably… We can now expect them to plummet.
Yes, and why are 30,000 EV’s declared as OFF THE ROAD? Here’s an interesting piece from Geoff Buys Cars.
https://youtu.be/hVfNkYAbgeg
I’ve not watched the vid yet bu my guess is buying the vehicle with a massive subsidy and then exporting it as new with ‘delivery mileage’ to another country. Declare it SORN to avoid detection.
Well, that’s what I would do.
Knowing how this government works, they’ll encourage EV drivers to overdeclare their annual mileage, by putting a hefty surcharge on excess miles incurred over the year, and they’ll refund unused miles at a fraction of the original cost.
Of dear…. payback time for those self-righteous Onanist gits who have been poncing off their fellow tax paying citizens to fund their mobile, planet saving, virtue-signalling, chariots of fire. What a shame – I’m filling up.
But. It could suggest the Labour slithy-toves know the Net Zero gig is up (Thanks to The Donald) and with it the electric vehicle fantasy, so cashing in while they can.
There’s nothing like taxing something to ensure less of it gets used. If they are serious about pushing people out of ICEVs into BEVs, this is not the way to do it.
As ICE vehicles currently pay more for RFL and fuel duty it’s entirely reasonable that EVs pay more too, they use the roads and should pay the same as ICE vehicles.
Enforcement can be obtained from analysis of MOT mileage records, except you don’t need an MOT for the first three years. I suppose you could calculate those first three from the first test, working on the assumption that the start mileage for a new car is about 30 miles. A huge bill will result then. What fun!
I wonder if all the virtue-signalling fools who chose to buy an EV have realised yet that they have been scammed by the Eco Nutters in the Establishment?
You just gotta love the joined up thinking. —-They want to pretend to save the planet by coercing us into EV’s and then tax them so we might decide to not bother getting one. They do the same with solar panels, as they now have this absurd idea to block the sun. ——–MORONS.
What about hybrids?