The Treasury has confirmed that Rachel Reeves' pay-per-mile car tax scheme will take effect from April 2028. The Chancellor previously announced a 3p per mile charge for electric vehicles (EVs) and 1.5p per mile for plug-in hybrids, but the specific month had not been disclosed until now.
Details of the New Charge
The new electric Vehicle Excise Duty (eVED) will apply to EVs and plug-in hybrid vehicles (PHEVs) from April 2028. Motorists will pay based on estimated mileage, with data collected during annual MOT tests. For an average driver covering 10,000 miles per year, the charge amounts to an additional £300 annually.
The Treasury's official response to a consultation that closed in March stated: "At Autumn Budget 2025, the government announced the introduction of electric Vehicle Excise Duty (eVED), a new mileage charge on electric vehicles (EV) and plug-in hybrid vehicles (PHEV), which will take effect from April 2028."
Rationale and Controversy
The eVED is designed to offset the loss of fuel duty revenue as more drivers switch to electric cars. However, the plan has sparked mixed reactions. A YouGov poll found 43% of road users support the scheme, while 34% oppose it, with 20% "strongly opposed." An Express.co.uk survey of 21,000 respondents showed 86.73% wanted any mileage-based tax axed.
Concerns include compliance and awareness among EV owners. The Treasury report added: "To reduce the risks of errors and support motorists in estimating and reporting mileage, DVLA will provide clear guidance and reminders ahead of eVED coming into effect in April 2028."
