Transport secretary Heidi Alexander has appeared on the BBC this morning to discuss the upcoming Budget
Drivers of electric vehicles have been warned by the government that the tax system for all motorists needs to be ‘fair’. Transport secretary Heidi Alexander made the announcement on the BBC’s Sunday with Laura Kuenssberg show as she was asked about whether a new pay-per-mile scheme was about to be introduced.
The BBC host asked the cabinet minister whether it was true that the government would make it more expensive for electric vehicle drivers to drive at the Budget. There has been widespread speculation that a new pay-per-mile scheme will be introduced to target EV drivers.
This is because while petrol and diesel drivers pay fuel duty, EV drivers do not. And as more people switch to EVs, governments around the world will see their income from fuel duty plummet – meaning they need to find new ways to raise funds.
Kuenssberg asked the cabinet minister why the government appeared to be preparing to make it more expensive to drive an EV at the same time as it has announced more support to make it cheaper to buy one. Overnight, it emerged that Chancellor Rachel Reeves will add £1.3 billion to a grant cutting upfront costs for buyers of electric cars in Wednesday’s Budget – knocking up to £3,750 off the price of an EV.
The minister said: “I am not going to pre-empt the Budget. The Chancellor will be on your show next week.
“As we make the transition to EVs, two things can be true at the same time. We need a fair vehicle tax system for all motorists because EVs, like drivers of petrol and diesel cars, are driving on roads that require maintenance.
“We have got ageing infrastructure, motorways that were built in the 1960s and 1970s, so we need to have a fair taxation system that is future-focused, but we are not going to do anything to jeopardise the transition to EVs and that will remain front and centre.”
The Treasury has also been equivocal over its plans. Earlier this month, the Telegraph reported that EV drivers would even have to pay the pay-per-mile charge of driving abroad.
The claim led to immediate criticism from some motoring commentators. Paul Barker, of the magazine Auto Express, said: “It wouldn’t be reasonable to charge drivers for mileage clocked up abroad when they’re not using UK roads or infrastructure, so getting the balance right will be vital to any sort of acceptance by motorists.”
In response, the Treasury would only say: “Just as it is right to seek a tax system that fairly funds roads, infrastructure and public services, we will look at further support measures to make owning electric vehicles more convenient and more affordable.”
