Chancellor Rachel Reeves has confirmed a new £240 road tax for UK drivers, set to begin later this decade. The charge will affect motorists driving electric and plug-in hybrid vehicles, with payments starting from April 2028.
New Electric Vehicle Excise Duty (eVED)
Under the new measures, drivers will be required to pay an Electric Vehicle Excise Duty (eVED), a pay-per-mile fee. This will be paid alongside the existing Vehicle Excise Duty (VED), according to the RAC. Electric vehicles will be charged 3p per mile, while plug-in hybrids will face a 1.5p per mile charge.
For electric car drivers averaging 8,000 miles per year, this equates to an extra £240 annually. The government has stressed that it will protect motorists' privacy, meaning no trackers will be installed, and drivers will not need to report their locations. Instead, vehicle mileage will be checked around the first and second registration anniversary.
Government Statement
A government spokesperson explained: "It will be set at half of the equivalent rate of fuel duty for electric cars, and half again for plug-in hybrid cars. eVED will ensure all car drivers contribute, but will still maintain important incentives to switch to an electric vehicle. eVED will not require ‘trackers’ in cars, nor will the government ask people to interact with a whole new tax system: car drivers will pay for the miles they drive alongside paying their usual road tax (VED)."
This announcement follows previous reports on West Midlands roads and aims to balance revenue needs with environmental goals.
