It's happening
For twenty years, pay-per-mile road pricing has been the policy that every British government considers and no British government implements. It has been proposed, consulted on, leaked, denied, and shelved with almost ritual regularity.
The Autumn 2025 Budget ended that. From April 2028, the UK will introduce eVED — Electric Vehicle Excise Duty — a per-mile charge on electric and plug-in hybrid cars.
- Battery electric vehicles: 3p per mile
- Plug-in hybrids: 1.5p per mile
- Charged in addition to existing VED, not instead of it
- Self-reported, with annual mileage verification (via the MOT for cars over three years old)
A government consultation on implementation is live on gov.uk.
The maths, plainly
| Annual mileage | EV (3p/mile) | PHEV (1.5p/mile) | |---|---|---| | 5,000 | £150 | £75 | | 8,000 (govt's stated average) | £240 | £120 | | 10,000 | £300 | £150 | | 15,000 | £450 | £225 | | 20,000 | £600 | £300 |
Add the standard £200 VED, and an EV driver covering 10,000 miles a year will pay roughly £500 in total motoring tax from 2028. If the car listed above £50,000, add another £440, and you're at £940.
The OBR's assessment is that 3p per mile represents roughly half the rate of fuel duty currently paid by an equivalent petrol or diesel driver. On that basis, EV drivers will still be paying substantially less. That framing is accurate, and it is the government's entire defence.
Why it's happening: the fiscal hole
The case for road pricing is, at root, arithmetic rather than ideological.
Fuel duty raises roughly £25 billion a year. Every EV sold removes a lifetime of fuel duty from the Exchequer. As BEVs move from 25% of new sales toward the mandated 80% by 2030, that revenue stream collapses.
There is no version of the UK's public finances in which £25 billion simply evaporates and nothing replaces it. Something has to. The only questions were what, when, and how visibly.
The government has chosen: a per-mile charge, in 2028, extremely visibly.
The case for
It is fairer than fuel duty. Fuel duty is a crude proxy for road use that punishes people with older, less efficient cars — who are, disproportionately, poorer people. A per-mile charge taxes the thing you actually want to tax: road use.
It closes a genuine inequity. A driver in a £70,000 electric SUV currently contributes nothing to road funding through fuel duty. A driver in a fifteen-year-old Corsa pays it on every litre. Whatever you think of EV incentives, that is difficult to defend indefinitely.
It is still cheaper than petrol. At roughly half the effective fuel duty rate, the EV running-cost advantage survives — just by less.
It's inevitable anyway. The alternative is a fuel duty rise on a shrinking base, which becomes progressively more punitive on precisely the drivers least able to switch.
The case against
The timing is terrible. The UK is simultaneously running a ZEV Mandate requiring 33% BEV sales in 2026 rising to 80% by 2030, an Electric Car Grant paying people £3,750 to buy EVs, and now a tax on driving them. The SMMT's argument is straightforward: you cannot mandate a transition, subsidise a transition, and tax a transition at the same time and expect the message to land.
It penalises high-mileage drivers, who are exactly the people EVs suit best. Someone doing 20,000 miles a year is the ideal EV candidate — that is where the running-cost advantage compounds most. They will pay £600. That is the wrong incentive gradient.
It hits rural drivers hardest. Mileage is not a lifestyle choice in rural Britain. It is a function of geography, poor public transport, and distance to a hospital. A per-mile charge is regressive by rurality in a way that is genuinely difficult to fix.
Self-reporting is a problem waiting to happen. The system depends on drivers accurately declaring mileage, verified annually. For cars under three years old there is no MOT, and therefore no independent check. The enforcement architecture is, to put it gently, undeveloped.
And the obvious question: if the whole point is that road pricing is fairer than fuel duty, why is it being applied only to electric and plug-in hybrid cars? A genuinely fair system would price road use for everyone and abolish fuel duty. What is actually being introduced is a targeted levy on the vehicles the government is simultaneously mandating.
That is not road pricing. It is revenue replacement wearing road pricing's coat.
What we think will actually happen
Three predictions, offered with appropriate humility.
1. The 2028 date will hold, but the rate will be politically contested to the last minute. 3p is a number that can move.
2. The self-reporting mechanism will be replaced or supplemented before launch. Some form of telematics or odometer-reporting-at-point-of-charge is a more likely long-term architecture, and the consultation is plainly fishing for it.
3. This is the beginning, not the end. Once the machinery exists to charge per mile for EVs, extending it to all vehicles — and phasing out fuel duty — becomes an administrative decision rather than a political one. Whether that is a feature or a warning depends entirely on where you sit.
What to do now: nothing, except be aware. If you are calculating the total cost of ownership on an EV you plan to keep past 2028, add roughly £240–£450 a year to your running costs from that point. It does not change the answer for most people. It does change the margin.
- eVED starts April 2028: 3p/mile for EVs, 1.5p/mile for PHEVs, on top of existing VED
- At 10,000 miles a year, that's £300 — or ~£500 including standard VED
- The OBR assesses it at roughly half the effective rate of fuel duty
- It's self-reported, with annual mileage checks via MOT for cars over three years old
- It applies only to EVs and PHEVs — which makes it revenue replacement, not true road pricing
Key takeaways
- eVED starts April 2028: 3p/mile for EVs, 1.5p/mile for PHEVs, on top of existing VED
- At 10,000 miles a year, that's £300 — or ~£500 including standard VED
- The OBR assesses it at roughly half the effective rate of fuel duty
- It's self-reported, with annual mileage checks via MOT for cars over three years old
- It applies only to EVs and PHEVs — which makes it revenue replacement, not true road pricing
Sources & further reading
- Autumn Budget 2025
- gov.uk eVED consultation
- OBR
- RAC Drive
- SMMT
Figures, prices and policy details were current at the last-updated date above. Automotive pricing, incentives and regulations change frequently — verify time-sensitive details with the linked primary sources. Read our editorial policy and fact-checking standards.
