Pay-per-mile tax could undermine net zero goals

"One of the massive benefits to driving an electric vehicle was that it was far cheaper to run than a petrol or diesel car, but a pay-per-mile tax risks eliminating that advantage, which could make drivers think twice about switching any time soon. It's almost sending mixed messages. We want people to switch to electric cars but they're dealing with limited charging infrastructure and other rising costs which can leave them questioning whether it's even worth it."

"Under the change, the levy is set at 3p per mile driven in an EV and 1.5p per mile driven in a PHEV. This will come into effect from April 2028. Electric vehicle drivers have already faced rising costs over the past couple of years such as higher insurance premiums, the introduction of Vehicle Excise Duty (VED) road tax, and an increase in the cost of home charging."

Chancellor plans to introduce a pay-per-mile tax for electric vehicles to replace lost fuel duty revenue, with a levy of 3p per mile for EVs and 1.5p for PHEVs from April 2028. Experts warn the charge may reduce the cost advantage of electric vehicles and deter drivers from switching, potentially slowing progress toward net zero. Electric vehicle owners have already faced rising costs including higher insurance premiums, Vehicle Excise Duty (VED) road tax, and higher home charging expenses. Limited charging infrastructure and other rising ownership costs exacerbate concerns that incentives for electrification are weakening.

Read at London Business News | Londonlovesbusiness.com