Chancellor Rachel Reeves has been urged to delay the introduction of a new car tax that could add up to £300 to annual bills for electric vehicle (EV) drivers. The proposed electric Vehicle Excise Duty (eVED) would introduce a pay-per-mile road pricing system for EVs, set to take effect as early as 2028.
AFP Calls for Two-Year Delay
Paul Hollick, chair of the Association of Fleet Professionals (AFP), has called for the policy to be postponed by at least two years, suggesting 2030 would be a more appropriate implementation date. He warned that introducing the tax in 2028 could destabilise the fledgling EV market, which is still recovering from residual value issues and charging infrastructure challenges.
“We strongly believe the government should look at ways of delaying and simplifying this proposal while reducing the burden on fleet operators,” Hollick said. “The electric car market is still stabilising and fleets remain negatively affected by residual value issues, Zero Emissions Mandate volumes and charging difficulties. Introducing eVED in 2028 is likely to slow adoption and increase costs. We believe moving its implementation to 2030 better aligns with fleet cycles and avoids destabilising both the new and used markets.”
Impact on EV Sales and Costs
The Office for Budget Responsibility (OBR) has previously estimated that the eVED could lead to 440,000 fewer electric vehicles being sold. The tax would charge EVs 3p per mile, adding £300 annually for drivers covering 10,000 miles. Hybrid vehicles would be charged 1.5p per mile, resulting in an extra £150 per year for the same mileage.
Dale Eynon, the AFP’s Government affairs and policy lead, has warned that the proposals require “rethinking at a fundamental level”. The tax has already been confirmed by the Chancellor and is scheduled for 2028, but industry voices argue that the timing could harm the transition to electric mobility.
Public Opinion Divided
A YouGov poll of 5,833 UK adults found mixed views on the pay-per-mile system. While 43% of road users supported the idea if it is fair and transparent, 34% opposed it, and 23% were undecided. The controversy comes as the government seeks to replace revenue lost from fuel duty as EV adoption increases.
The AFP’s intervention adds pressure on Reeves to reconsider the timeline, with fleet operators particularly concerned about the impact on vehicle demand and operational costs.
