UK to introduce 3p per mile electric vehicle excise duty from April 2028

Chancellor Rachel Reeves has confirmed a new pay per mile levy starting in April 2028, charging electric vehicle owners 3p per mile and plug in hybrid owners 1.5p per mile. The electric vehicle excise duty (eVED) means an average driver covering 8,000 miles annually would pay £255, with the Government introducing the measure to offset fuel duty losses from the shift to electric vehicles. The charge follows the removal of vehicle tax exemptions for EVs in 2024.

Why it matters: The new mileage based tax may affect total cost of ownership calculations for fleet operators and workplace charging schemes, potentially slowing EV adoption rates among cost sensitive buyers. CPOs and charge point installers should monitor whether the 2028 levy influences procurement timelines or shifts demand toward home charging to reduce tracked mileage.