Electric Vehicles: Excise Duties
The question
To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of introducing a 3p-per-mile charge for electric cars and 1.5p for plug-in hybrids on low-income households, the environment, society and the economy.
Answered by Dan Tomlinson
As announced at Budget 2025, the Government is introducing Electric Vehicle Excise Duty (eVED) from April 2028, a new mileage charge for electric and plug-in hybrid cars, recognising that EVs contribute to congestion and wear and tear on the roads but pay no equivalent to fuel duty.
The Government has set out estimated impacts on household incomes from tax, welfare and public service spending decisions taken at Budget 2025, including eVED. These impacts are available at GOV.UK: https://assets.publishing.service.gov.uk/media/69269c6222424e25e6bc31bb/Impact_on_households.pdf
The Government has also set out Exchequer and behavioural impacts from eVED and other Budget measures in the Budget 2025 Policy Costings document at GOV.UK: https://assets.publishing.service.gov.uk/media/692872fd2a37784b16ecf676/Budget_2025-Policy_Costings.pdf
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