Hunt said in Thursday’s Fall Statement that electric vehicles will no longer be exempt from the vehicle excise tax.
The UK is set to introduce a road tax on electric cars from 2025, Finance Secretary Jeremy Hunt said, ending the exemption to boost the adoption of zero-emission vehicles.
In Thursday’s Autumn Statement, Mr Hunt said electric vehicles would no longer be exempt from the vehicle excise tax as he unveiled a series of tax increases and spending cuts designed to offset a £55 billion ($65 billion) loss in UK public finances.
The prime minister said that electric vehicles would still have a lower corporate car tax rate and the government would limit tax rate increases to one percentage point a year for three years from 2025.
The UK plans to end the sale of new cars with internal combustion engines by 2030, and carmakers have long demanded incentives to promote the use of electric vehicles. The phasing out of the road tax exemption after cutting subsidies for electric vehicles last year.
“The prospect of further increases in operating costs will drive more electric vehicle buyers away from electric vehicles as other incentives are being phased out,” said Ian Plummer, commercial director of online marketplace Auto Trader Group Plc. and high energy bills are eroding the advantage of using electricity.”
“An excise tax sweep is futile and sends the wrong message if we are serious about making electric cars mainstream.”
