What is the electric car tax? Drivers hit with new costs from April

Mr Hunt had said: “And, due to the fact that the OBR forecasts fractional of each caller vehicles volition beryllium electrical by 2025, to marque our motoring-tax strategy fairer, I person decided that, from April 2025, electrical vehicles volition nary longer beryllium exempt from Vehicle Excise Duty.

He added: “Company car taxation rates volition stay little for electrical vehicles and I person listened to manufacture bodies and volition bounds complaint increases to 1 percent constituent a twelvemonth for 3 years from 2025.”

So what is Vehicle Excise Duty and what volition alteration for drivers of electrical cars arsenic of April 2025?

Vehicle Excise Duty (VED) is popularly known arsenic roadworthy tax. Drivers wage it erstwhile they archetypal registry their car, and past again each six oregon 12 months, oregon tin wage monthly.

The taxation complaint a operator pays varies based connected the car’s property and CO2 emissions. Drivers of vehicles that outgo much than £40,000 volition person to wage an further fee, dubbed the Tesla Tax.

Until now, electrical cars person been exempt from paying VED successful an effort to promote the acquisition of low-emissions and zero-emissions vehicles.

However, arsenic the fig of electrical cars successful the UK is increasing, the wealth the Government makes from roadworthy taxation is facing decline. Additionally, drivers of electrical cars person not been contributing to the attraction of the roads they thrust connected oregon immoderate of the different services that roadworthy taxation payments lend to.

HM Treasury said successful a tweet: “The displacement to Electric Vehicles is continuing astatine gait arsenic the UK moves to nett zero. Therefore from 2025, roadworthy taxation volition beryllium introduced for EVs truthful each motorists statesman to wage a just share.  Support for charging infrastructure is continuing.”

Advocates for electrical cars person said the further outgo could deter radical from buying electrical vehicles successful the future.