Budget - 3p per mile charge on EVs: comment

“Trying to encourage people to embrace electric vehicles whilst adding a new tax on those vehicles is a recipe for confusion. The OBR forecasts that this tax will reduce EV sales by 440,000 as mixed messaging hits consumer confidence, keeping families in more polluting and expensive petrol cars for longer.

“While these mixed signals are a big risk, this 3p per mile charge will not stop EVs remaining significantly cheaper to run than petrol cars, delivering ownership savings of over £1000 a year. [1] But, if the confusion caused by this new tax does slow EV sales then the £6.2bn in savings to drivers that could have been delivered over the lifetimes of these 440,000 EVs will be lost in the midst of a cost of living crisis. Remember, every new EV sold is a second-hand car after three or four years, helping regular families cut their driving bills.”