News & Features

Vehicle Excise Duty to Impact EVs

Posted in General News on Tuesday, November 22nd, 2022

The Chancellor of the Exchequer has stated that electric vehicles (EVs) will be subject to Vehicle Excise Duty (VED) from 2025 by which point, half of all vehicles on the road are projected to be EVs. EVs registered from April 2025 will be taxed at the lowest rate of £10 for the first year and then they will be moved up to the standard bracket of £165 per year. The standard rate will also apply to EVs first registered after April 2017. Disabled people who are either entitled to VED exemption or a 50% reduction will continue to qualify when they make the switch to electric vehicles. 

The AA believes that the decision to tax EVs will remove a key incentive for motorists in making the switch to electric and dampen the environmental benefits of doing so. Whereas the RAC does not believe the announcement will have much effect on the take-up of EVs.  

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Brian Bremer's Gravatar
Brian Bremer

Wednesday, November, 23rd, 2022

Whilst many will bemoan that EVs will now have to pay, they forget one thing. At present they are effectively driving for free on the Highways which they will jointly wear down, damage or in other ways need remedial work. So why should they be exempt from contributing to the upkeep? Currently as a Motability customer, the thought of being able to have an opportunity to also drive EVs is nothing more than a dream most cannot afford

Mrs P Ritchie 's Gravatar
Mrs P Ritchie

Wednesday, November, 23rd, 2022

I believe that the AA’s comment was correct. The main incentive for people to purchase EV’s in the first place was not paying Vehicle Tax. I understand the Government need to bring in some sort of Vehicle Tax after 2025 but feel that the standard bracket of £165 is far too much. What would the criteria be for a non-standard tax and how much would that be? It does not seem to be a well thought out scheme by the Government but maybe by 2025 they have revised this and made it easier for people who have to purchase a EV through no fault of their own. This is a similar reaction to the Government’s when they suggested that Diesel was better than Petrol and so manufacturers started building more diesel cars - then the diesel, which up until that point was cheaper than petrol, became much more expensive, overtaking the cost of petrol by, in some areas £1-£2 per litre! No doubt the Government will put the cost of charging EV’s up to compensate for not getting a fuel tax! We cannot win! Whichever way you look at it, it will still be expensive for the average person to drive!

ChrisK's Gravatar

Wednesday, November, 30th, 2022

The free lunch was bound to end sooner than later but £165 is cheap if you consider that ICE cars pay £165 plus £40 > £60 Tax and duty every time they fill up and VAT @ 20%. Expect extra charges for EV’s in the way of cost per mile over the next few years and its no good bemoaning the excuses that it discourages us to change to EV because in 7 years time we will have no choice.