The Government has confirmed it will press ahead with a pay-per-mile tax for electric vehicles from April 2028, following a consultation that drew more than 5,000 responses. Electric car drivers will pay 3p a mile and plug-in hybrid drivers 1.5p a mile, alongside existing road tax.
TL;DR · LAST REVIEWED 14 July 2026
- The Electric Vehicle Excise Duty (eVED) takes effect from April 2028, on top of existing Vehicle Excise Duty (VED).
- Confirmed rate: 3p per mile for battery electric cars, 1.5p per mile for plug-in hybrids.
- No GPS tracking or telematics -- mileage will be checked using MOT readings and annual self-reporting.
- New electric cars under three years old will not need an extra mileage inspection before their first MOT.
- The government estimates the tax will raise around £1.2 billion a year.
- Electric vans, buses, motorcycles, and HGVs are exempt when the scheme launches.
KEY FACTS
- Start date: April 2028
- EV rate: 3p per mile
- Plug-in hybrid rate: 1.5p per mile
- Estimated annual revenue: ~£1.2 billion
- Consultation responses received: 5,000+
- Verification method: MOT readings + self-reporting, no mandatory GPS tracking
What the government has confirmed
The government has confirmed it is pressing ahead with a new pay-per-mile tax for electric vehicles, due to take effect from April 2028. The Electric Vehicle Excise Duty, referred to as eVED, will apply alongside the existing Vehicle Excise Duty (VED) system rather than replacing it, meaning EV and plug-in hybrid drivers will pay both a standard annual road tax charge and a new mileage-based charge. The reform follows a public consultation that drew more than 5,000 responses from drivers, businesses, and industry bodies. It is designed to offset the decline in fuel duty revenue as more drivers switch away from petrol and diesel, an income stream the Treasury currently relies on for tens of billions of pounds a year. Electric cars stopped being exempt from standard VED in April 2025, and the introduction of eVED marks the next stage in aligning how electric and combustion-engine vehicles are taxed on the road.
How much you'll pay per mile
Under the confirmed rates, drivers of fully electric vehicles will pay 3p for every mile driven, while plug-in hybrid drivers will pay a discounted rate of 1.5p per mile, reflecting the fact that hybrids still use some petrol or diesel and therefore already pay some fuel duty. For a driver covering 8,000 miles a year, that works out at around £240 in additional charges for a fully electric car, or £120 for a plug-in hybrid. The government has said this rate is set deliberately at roughly half the equivalent fuel duty paid by petrol and diesel drivers for the same mileage, so electric vehicles remain cheaper to run overall even after the new charge is introduced. Officials estimate the scheme will raise approximately £1.2 billion a year once fully in place, helping to fund road infrastructure as fuel duty receipts continue to fall.
How your mileage will be checked
One of the main concerns raised during the consultation was how mileage would be tracked, and whether this would involve GPS or telematics devices monitoring where and when people drive. The government has ruled this out, confirming that eVED will record only how many miles a vehicle has travelled, not where, when, or how those journeys were made. For most cars, mileage will be checked using the annual MOT test once the vehicle is three years old. Newer vehicles, which do not yet require an MOT, will need a separate annual mileage check in their first two years, though the government has confirmed that cars under three years old will not need an extra inspection before their first MOT, reducing an administrative burden that was raised as a concern. Businesses and leasing companies will also benefit from simplified reporting rules, the ability to use estimated mileage in some circumstances, and more flexible bulk licensing and payment options.
What this means for EV owners now
For current EV and plug-in hybrid owners, nothing changes immediately. Standard VED for most electric cars remains £200 a year in 2026, rising to £620 for vehicles that also attract the expensive car supplement. The pay-per-mile charge will not begin until April 2028, and final legislation has not yet been introduced, so the detail could still be refined before it takes effect. Anyone buying or leasing an EV in the meantime should factor the future mileage charge into their running-cost calculations, particularly for higher-mileage drivers such as those covering long commutes or using their car for business, since the additional cost scales directly with distance travelled. Electric vans remain exempt from eVED at launch, which may influence timing decisions for small businesses considering an EV van purchase in the next few years.
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DISCLAIMER
This article is editorial information, not financial advice. Kael Tripton Ltd is not authorised or regulated by the Financial Conduct Authority. Figures were correct at the last review date shown above; verify current rates and rules with the primary sources listed below before acting.
Frequently asked questions
When does the pay-per-mile tax for electric cars start?
From April 2028. It applies alongside existing Vehicle Excise Duty, not instead of it.
How much will I pay per mile under eVED?
Confirmed rates are 3p per mile for fully electric cars and 1.5p per mile for plug-in hybrids.
Will my car be tracked by GPS to work out my mileage?
No. The government has ruled out GPS or telematics tracking. Mileage will be checked through MOT readings and annual self-reporting.
Does eVED replace my existing road tax?
No. It is an additional charge on top of standard Vehicle Excise Duty, not a replacement for it.
Are electric vans included in the new tax?
Not at launch. Electric vans, along with buses, motorcycles, and HGVs, are exempt when eVED is introduced.
SOURCES
- GOV.UK -- Consultation on the Introduction of eVED – accessed 14 July 2026
- GOV.UK -- eVED Government Consultation Response (PDF) – accessed 14 July 2026
