The Government’s suggestion of imposing a new pay-per-mile tax on electric vehicles could push potential buyers away from EVs, according to new research from fleet management specialist Zenith.
Almost three-quarters of drivers (74%) are concerned about the potential cost impact of a pay-per-mile tax, with four in 10 (40%) saying they would consider switching back to an internal combustion engine (ICE) vehicle if running costs of an EV became more expensive.
The fourth edition of Zenith’s EVXperience Report (EVX4) report also reveals that nine in 10 EV drivers (88%) believe the Government is failing to do enough to support the UK’s transition to net zero.
While Government-backed incentives, such as low benefit-in-kind (BIK) company car tax rates, have proved effective in encouraging uptake, recent U-turns on the deadline for the sale of new petrol and diesel cars and the recent announcement of a possible new pay-per-mile tax for EV drivers, have impacted confidence in the delivery of a successful transition.
The pay-per-mile tax, called electric vehicle excise duty (eVED), would result in zero-emission cars attracting a new charge of three pence per mile in addition to existing road taxes from April 2028.
PHEVs would also be hit with the new tax, being charged at 1.5ppm, with both pence per mile rates increasing annually with CPI.
Andy Wolff, managing director of Zenith’s corporate division, said: “These findings highlight a clear disconnect between the government’s stated ambitions and the confidence felt by EV drivers on the road, with inconsistent policy undermining trust in the transition.
“Drivers are being offered tax incentives and grants to encourage EV adoption while simultaneously facing uncertainty around future taxation, including proposals such as pay-per-mile charges. These conflicting messages mean only 15% of EV drivers feel optimistic and confident about the transition to electric vehicles.”
