Electric vehicles face a new pay-per-mile levy to replace the falling fuel duty revenue.

The Telegraph is reporting that the next Budget will includes measures to tax EVs and hybrids by up to 3p per mile in addition to VED and road tax from 2028.

The move to EVs has meant that the Government has received declining fuel duty revenue as, with estimates that six million people will drive EVs in three years’ time.

Naturally the Government will appeal to that catch all phrase ‘fairness’ to explain away the inconsistency in its approach to encouraging net-zero.

A pay-per-mile road taxation system has long been mulled by governments of all colours, and in its simplest form could be linked to MOTs, or more complex and system of estimated milage and credits

The report comes as The Telegraph has also questioned whether the Chancellor might also raid the Government’s own flagship Warm Homes Plan to fund cuts in energy bills.

Ahead of winter, the Government’s unpopular green levies have helped increase average energy bills, and cutting these, that help pay for schemes sauch as the Warm Homes Plan, would be a way to alleviate the political fallout during the colder season.

But it would also reduce the incentives for heat pumps and home insulation, something that DESNZ is likely to try and resist, setting the chancellor and Ed Miliband on collision course.
In both cases, it is clear that the policies for net-zero and needs of government policy are not fully aligned. Indeed, incoherent might be a better word.

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