Tax coming for EV’s

Mollygo

My new last year hybrid costs us £195 VED. Its emissions evidently have nothing to do with the cost. DDs much older car costs £10pa.

Mine, which is a bit older than yours, is also £195 pa.

The emissions are very low, according to what it tells me after each journey.

My new last year hybrid costs us £195 VED. Its emissions evidently have nothing to do with the cost. DDs much older car costs £10pa.

petra

It was always on the cards that this would happen. They ( that’s any government) have left a decent amount of time before they announced the inevitable.

True. The easy ride so far - no pun intended- was just the sweetener to encourage people to change to EVs, but it was a given that this would not be permanent.

MaizieD

VED, apart from NOT being 'road tax' is completely different from fuel tax as it is based on the car's emissions. Vehicles with lower emissions are taxed at a lower rate. It's meant as an incentive to buy a low emissions vehicle.

I'm not sure where you are getting your figures from, Mamie, because I only pay £26 pa on my car. Whereas the VED on my ancient Land Rover (which we no longer use on the road because of the high VED) was over £200 pa. It was more than the VED on our 7.5 tonne horsebox!

If VEDs are indeed to pay £195 pa then the link between VED rates and emissions must have been severed. Most unfairly IMO.

www.drive-electric.co.uk/guides/general/understanding-ev-vehicle-excise-duty-or-road-tax/

VED, apart from NOT being 'road tax' is completely different from fuel tax as it is based on the car's emissions. Vehicles with lower emissions are taxed at a lower rate. It's meant as an incentive to buy a low emissions vehicle.

I'm not sure where you are getting your figures from, Mamie, because I only pay £26 pa on my car. Whereas the VED on my ancient Land Rover (which we no longer use on the road because of the high VED) was over £200 pa. It was more than the VED on our 7.5 tonne horsebox!

If VEDs are indeed to pay £195 pa then the link between VED rates and emissions must have been severed. Most unfairly IMO.

Bibedybop

rosie1959

Sounds a lot of faffing about why not just put road tax on electric vehicles.

It is to replace the loss of duty on petrol, the more you use the more you pay rather than the fixed price of road tax ( depending on vehicle type).

EVs and PHEV cars have been subject to VED since April 2025.
EVs registered on or after April 1, 2017, will pay the standard annual rate of VED, which is currently (April 2025) £195 per year.
Older electric vehicles registered between 1st March 2001 and 30th March 2017 will be subject to the reduced rate for older vehicles of £20 per year.
Newer EVs registered after 1st April 2025 will pay the standard annual rate, and if they cost over £40,000, an additional £425 “expensive car supplement” applies from years 2–6.

rosie1959

Sounds a lot of faffing about why not just put road tax on electric vehicles.

It is to replace the loss of duty on petrol, the more you use the more you pay rather than the fixed price of road tax ( depending on vehicle type).

Mollygo

Sorry. Phone corrected GBP (great British public).

Or 'GB Pound', as seen on many trading sites

Sorry. Phone corrected GBP (great British public).

Mollygo

The impact on Transport firms and bus companies who followed the government instructions and opted for EV will be followed by an impact on the GBP. Costs didn’t suddenly go down when firms used electric vehicles, but you can be certain they will go up when the new tax comes in..

How is it going to affect GDP? (I assume that you didn't mean the pound sterling by GBP)

GDP is a measure of the 'value' of productivity. Are you saying that productivity will be affected if businesses have increased costs? And why didn't costs go down when they started using EVs?

Thats only the start Mamie
Since transport vehicles are a large user of fuel, the government aren’t going to miss out on that revenue.
Will taxis count as commercial vehicles?

Whitewavemark2

It won’t work.

They will be reviewing it before long.

You’re probably right, in that this is the first iteration. However, EV vehicle owners will pay road tax in one form or another.

Mollygo

The impact on Transport firms and bus companies who followed the government instructions and opted for EV will be followed by an impact on the GBP. Costs didn’t suddenly go down when firms used electric vehicles, but you can be certain they will go up when the new tax comes in..

As I understand it, the tax only applies to private cars, not commercial vehicles.

The impact on Transport firms and bus companies who followed the government instructions and opted for EV will be followed by an impact on the GBP. Costs didn’t suddenly go down when firms used electric vehicles, but you can be certain they will go up when the new tax comes in..

It won’t work.

They will be reviewing it before long.

Thinking about the loss of fuel duty to the government implicit in the use of EVs I looked at the 3p per mile charge as being a substitute for the lost duty.

Chatgpt helped me with this, The figures are not altogether helpful, though.

It estimated that the average fuel cost per mile (pm) of running a petrol or diesel car was 13 - 17p per mile.

EV costs per mile varied a lot because home charging is cheaper than 'public' charging.

On home charging it worked out at 5 - 9p pm. So a charge of 3p pm would still keep the cost far lower than running a petrol or diesel car.

Public chargers are much more expensive, 15 - 20 p pm. A 3p pm charge on top of this would make the costs roughly equivalent to using fossil fuel.

Of course, UK electricity cost is notoriously very high because of the way it is calculated on the cost of the most expensive way of producing electricity using gas fuelled generation.

AI again:

All 2024 figures

Gas generation accounts for 30.4% of our electricity. 1.4% is 'other' fossil fuels.

Renewables generation accounts for 68.2% of our supply, though 7% is biomass fuelled, which is contentious.

There is an arguable case for basing the cost of our electricity on a lower cost of production figure because of the proportions of the current ;mix' of generating methods.

Which boils down to, if cost of electricity falls cost pm of running an EV should fall.

EV owners I know say it'll still be cheaper than the tax onpetrol/diesel.

It'd be relatively simple to put in a device similar to a home smart meter to relay the information and then pay by Direct Debit. Whether this would actually work is anyone's guess.

Yes I know I meant the commute. I can understand the justification about using the road more might make sense but perhaps it is more complex than that.

Galaxy

Does it? I don't know. If you are driving five days a week to do a job vital to society's functioning. I don't know.

In work miles are usually paid by the employer though Galaxy.

According to ChatGP, most studies show that EVs pay back their higher manufacturing emissions within 1-2 years of driving.

Over their full life, EVs emit 50-70% less carbon dioxide than comparable gasoline cars.

In countries such as Norway, with very clean grids, reductions reach 80%+.

Battery life is improving which will reduce future mining demand.

New technologies e.g. lithium-iron-phosphate batteries, also reduce reliance on high-impact minerals.

Astitchintime

It would be far simpler to tax ALL vehicles regardless. They all cause wear to the roads after all.

This was my thought too.
If only all the VED went on improving the roads, though!

This announcement surprised me as I have a hybrid and already pay VED but then realised that plug-in hybrids were exempt until now.

Electric and hybrid cars are on average 20-30% heavier than comparable petrol/diesel cars, therefore they cause more damage to our roads than traditional cars.

Whilst being better for air pollution, the current carbon footprint for manufacturing and electric or hybrid cars is significantly higher than that of petrol/diesel vehicles due to mining for raw materials for battery cells.

You have to drive for approximately 20,000 miles in an EV before it comes anywhere near carbon neutral depending on where the electricity used to charge is produced.

Only correct that these car drivers pay to use the roads.

Margiknot

As EVs all have their own computer wizardry to drive the charging system, I wonder if the technology is already there to send mileage to DVLA?

The technology was built in in the beginning. This was always going to happen.

Does it? I don't know. If you are driving five days a week to do a job vital to society's functioning. I don't know.

It won’t be overturned*granfromafar*, as more people convert to electric vehicles it was always going to happen. Hopefully what will happen in future will be that all vehicles pay tax based on miles per year, as it does make more sense that if you use the roads more, you pay tax accordingly.