Electric Car Drivers to Pay Tax
Reading time 4 minutes
Categories Driving Law » Insurance & Finance »
Electric Car Drivers to Pay Tax
Reading time 4 minutes
Categories Driving Law » Insurance & Finance »
To say that the British economy has had somewhat of a turbulent 2022 is something of an understatement.
With the pound plummeting and a recession on the cards, the country’s financials have made for grim reading in recent months and led to the new chancellor, Jeremy Hunt, making some big decisions in his Autumn Statement in November.
Key among these was the announcement that electric cars will start paying tax for the first time ever from 2025. Hunt described the move as a ‘fairer’ motoring system with around 50% of vehicles on British roads predicted to be electric by 2025 according to the Office for Budget Responsibility.
In this article, the team at The Windscreen Company will take a look at the tax changes and what they could mean for the future of the electric car industry.
Vehicle Excise Duty, or VED, is a tax levied on vehicles on UK roads. Previously, all electric vehicles had been exempt from this tax, but this will change in 2025.
Vehicles that contribute the most pollution pay higher rates, so when electric vehicle owners start paying this tax, they will still be contributing less than petrol and diesel vehicles.
In the first year, the VED charge for electric vehicles will be £10 and then £165 from the second year of registration onwards.
By 2030, the sale of all new petrol and diesel vehicles will be banned in the UK as the country strives to be greener. With this in mind, the RAC has stated that it believes the VED charges are fair, but the AA is concerned that it could slow the country’s electrification goal.
In recent years, the popularity of electric vehicles has soared dramatically. 2022 has experienced a particular boom, with the first three months of the year seeing EV registrations up by more than 100% when compared to 2021.
When you consider that last year was also a record year in terms of electric car sales, it’s clear to see that consumers have truly started to embrace electric vehicles.
Undoubtedly one of the biggest draws behind people getting an electric car was the fact that they were exempt from tax. As well as that they’re better for the environment, the money they saved drivers was a big plus, so it’s interesting to see how sales will be impacted beyond 2025 when the tax comes into force.
While electric vehicles may no longer be exempt from tax from 2025 onwards, there are still a number of vehicles that will not have to pay. This includes:
Plus, the VED tax on electric vehicles will only be introduced in 2025, so there is still more than two years before EVs will be exempt.
Here at The Windscreen Company, whether you drive an electric vehicle or a fuel-operated one, we’re here to help. We offer an electric and hybrid car windscreen repair and replacement service that can keep you safe when out on the roads. Even minor damage can cause big problems, so it’s important that any issues are addressed as soon as possible. We’ll even offer a car windscreen calibration service that will ensure your vehicle’s ADAS systems are working as they should be. Operating across the West Midlands and South East, get in touch with our team today.
The Windscreen Company, has over 20 years of experience in windscreen repair and replacement. Since 1998, they have been at the forefront of industry innovation, leveraging the latest technology to ensure customer safety and satisfaction.
The Windscreen Company's, help-and-advice pages offer valuable tips and guidance on maintaining vehicle safety through quality windscreen care, while also featuring updated industry realted content.
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