UPDATE: Electric vehicle (EV) drivers are facing a new financial burden as a £243 annual charge is set to take effect starting April 2028. This groundbreaking announcement follows the recent Budget declaration of a pay-per-mile tax on both hybrid and electric cars, sending ripples through the EV community.
According to car insurance expert MoneySuperMarket, the proposed rate will be 3p per mile for fully electric vehicles. Based on average annual mileage estimates of 8,116 miles, this could translate into an additional yearly cost of £243 for EV drivers. Meanwhile, plug-in hybrid vehicles will incur a slightly lower charge of 1.5p per mile.
This new tax is stirring significant concern among EV owners but experts urge consumers to keep perspective. Kara Gammell, a personal finance and car insurance specialist at MoneySuperMarket, emphasizes that despite this added expense, EVs will still be more economical than traditional petrol or diesel cars. “While the introduction of this new tax in April 2028 may feel like a setback, it’s important to keep the bigger picture in mind,” Gammell stated.
Currently, drivers of petrol and diesel vehicles face an average annual fuel duty of around £600. In contrast, the projected average annual charge for EVs under the new pay-per-mile scheme is expected to be about £243—less than half the current cost for traditional fuel vehicles. This means that even with the new charge, EV owners could save significantly on running costs.
In addition to the new mileage tax, recent data indicates that insurance rates for electric cars have fallen by about £137 since March 2025, bringing the average premium down to £587. This positions EV insurance almost on par with petrol and diesel vehicles, making the switch to electric more appealing for potential buyers.
MoneySuperMarket has developed an electric pay-per-mile calculator to assist drivers in estimating their future expenses based on vehicle type and personal driving habits. This tool aims to provide clarity amidst the uncertainty surrounding the upcoming tax changes.
The implications of this new policy extend beyond just numbers; they impact the broader movement towards sustainable transportation. As more drivers consider making the switch to electric, understanding the financial landscape is crucial for their decisions.
With the April 2028 implementation date looming, EV drivers are encouraged to prepare for this transition. Authorities will likely provide further details as the date approaches, so staying informed is essential.
As the debate continues, drivers are urged to weigh the benefits of electric vehicle ownership against the impending costs. The EV landscape is evolving rapidly, and those contemplating a switch should act swiftly to take advantage of current incentives and lower insurance rates before the tax kicks in.
In summary, while the new charge may initially seem disheartening, the long-term savings and benefits of electric vehicles still make them a viable option for environmentally conscious consumers. Stay tuned for more updates as this situation develops.
