Pay Per Mile Electric Car Levy Threatens to Stall Uptake of EVs in UK Government Faces Backlash Over Proposed Charge

The Treasury is weighing up introducing a 3p per mile charge for drivers of electric vehicles, a move that has raised alarm across the motoring industry and among consumer groups. The proposal, driven by a need to offset declining fuel duty revenues, comes at a critical juncture in the UK’s transition to cleaner transport options. Industry leaders and analysts warn this measure could undermine not only the confidence of consumers but also jeopardise the government’s ambitious net zero targets.

Chancellor Rachel Reeves is expected to unveil the details of this policy in the upcoming budget announcement on 26 November. Motoring associations such as the AA stress that urgency in plugging the multibillion-pound hole left by shrinking petrol and diesel sales should not lead to policies that risk slowing the adoption of electric vehicles. The latest figures suggest the government’s zero emission vehicle mandate, targeting 28 per cent of new car sales this year, will fall short as uptake lags at 22 per cent.

Under the discussed plan, electric vehicle owners would pay in advance based on an anticipated annual mileage. Any unused portion could be rolled over, while those exceeding their estimate would have to top up. The exact mechanics of monitoring and enforcement remain unclear, and authorities plan to layer this payment on top of existing vehicle excise duty obligations.

Industry representatives such as the Society of Motor Manufacturers and Traders express frustration, arguing this direction creates additional complexity and deters potential buyers from switching to electric cars, just as encouragement is most needed. It also casts a shadow over recent government incentives, including grants of up to £3,750 for lower-priced environmentally-friendly cars and funds for green infrastructure such as charging points.

Trade bodies emphasise the necessity for a careful, transparent review of motoring taxes as the vehicle fleet diversifies. Rumours and premature proposals risk unsettling consumers already grappling with the intricacies of EV ownership. Careful consultation and clear communication are vital to avoid stalling the much-needed growth of this market, which is central to the UK’s climate targets and industrial strategy.

The government has also allocated grants for households to improve access to charging at home, including residents without driveways. Councils across the country are set to receive capital for installing pavement charging gullies in an effort to make EV ownership viable for more people. As the debate over motoring taxation heats up, both the industry and consumers await clarity on future policies that will shape the path to zero emissions.