Starting in 2028, electric vehicle (EV) drivers in the United Kingdom will face a new pay-per-mile road tax, known as eVED (Electric Vehicle Excise Duty). This change will add an estimated £200–300 annually to running costs, calculated based on actual mileage driven. The move aims to offset lost fuel duty revenue as more drivers switch to EVs, but raises questions about affordability and EV adoption.
How eVED Will Work
The eVED system will charge drivers three pence per mile for fully electric vehicles and one-and-a-half pence per mile for plug-in hybrids (PHEVs). These rates will increase each year to match inflation. Mileage will be recorded during annual MoT tests for vehicles over three years old, while newer cars will undergo annual odometer checks at authorized garages. Drivers will estimate their yearly mileage when paying road tax, receiving a refund or bill at year-end based on actual usage.
Will EVs Still Be Cheaper?
While EVs were previously praised for lower running costs, the new tax narrows the gap with gasoline and diesel cars. Analysis shows that even with eVED, charging at off-peak home rates will likely still be cheaper for EVs. However, using expensive public charging stations could make EVs as costly as traditional vehicles.
For example, a Volkswagen ID.3 running on off-peak electricity costs roughly two pence per mile plus the three pence eVED tax. In contrast, a gasoline or diesel Golf costs around ten to twelve pence per mile. But if charging at public stations, the ID.3 could cost nine pence per mile with the tax included – comparable to a gasoline car.
The Political and Industry Response
The proposed tax has drawn criticism from the automotive industry and public alike. Edmund King, president of the AA, stressed the need for transparency and protections for groups like carers and rural drivers who rely heavily on cars.
The Office for Budget Responsibility estimates eVED could raise £1.4 billion annually by 2029–30, but also predicts it could reduce EV sales by 440,000 units by 2031. Ford UK criticized the timing, arguing that the tax undermines EV incentives and will slow adoption. Instavolt CEO Delvin Lane pointed out that such policies could deter investment in charging infrastructure.
What This Means for Drivers
The introduction of eVED is a significant shift in road taxation policy. It underscores the government’s need to recoup lost revenue as EVs replace fossil fuel cars. While EVs remain competitive in many scenarios, the new tax complicates the financial equation. The effectiveness of the system will depend on fair implementation, transparent mileage tracking, and ongoing adjustments to ensure it doesn’t stifle EV growth.
