New EV tax could cost economy billions, association warns
The UK's planned mileage-based Vehicle Excise Duty for electric vehicles (eVED) in 2028 could cost the economy up to £4.8 billion, according to a trade association. The association is calling for the policy to be delayed until 2030.
The UK Government plans to introduce mileage-based Vehicle Excise Duty for electric vehicles (eVED) in 2028. A trade association, BEAMA, warns this could cost the economy up to £4.8 billion in a worst-case scenario. BEAMA's forecast is based on the impact of a similar EV mileage tax in New Zealand. The association claims that if UK EV sales fall at the same rate, it could result in a loss of VAT revenue and compliance costs for leasing companies. Even if EV sales are replaced with petrol and diesel car sales, there would still be an £890 million cost in lost tax receipts and compliance costs. BEAMA, along with EVA England, ChargeUK, and REA, is calling for the policy to be delayed until 2030. The partners have written to Daniel Tomlinson MP, exchequer secretary to the Treasury, to argue this point. The Government launched a consultation on its eVED policy in March this year, stating that motoring taxation is 'one of the clearest examples of overdue reform'.
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