UK motorists welcome future EV tax introduction to counter fuel tax losses

With 87% backing a range of proposals to ensure a viable fiscal switch

  • 87% of motorists surveyed by Venson Automotive Solutions agree fuel tax losses need to be recouped as EV adoption rises
  • 38% back the introduction of a new EV tax, followed closely by 32% calling for free public EV charging points to be replaced with paid-for charging points
  • 27% of people believe businesses operating EV fleets should incur additional costs

A new survey of 300 motorists by Venson Automotive Solutions reveals that 87% agree a financial solution to recoup the Treasury’s anticipated ‘fuel tax’ loss of £40 billion as a result of growing EV adoption, is needed. However, opinion is divided on how this can be achieved1  with the most popular solution amongst those surveyed being the introduction of a new Electric Vehicle tax (38%), which could see drivers of heavier vehicles, opposed to those with a greater engine size,paying heftier taxes.

Ministers are currently looking at different ways to recover funds lost from both vehicle and excise duty (VED) – or car tax – and fuel duty when more drivers switch to plug-in vehicles and the number of petrol and diesel motors on the road declines.

Earlier this year a House of Commons Select Committee said that road pricing is one of the best fiscal changes to make2, however, just 22% of those surveyed by Venson backed this recommendation. Instead, survey respondents said they would welcome a move to end free public EV charging points (32%) and backed the introduction of a ‘Road Miles’ system which would see charges incurred by plug-in drivers with higher mileage use (31%). Areport by the not-for-profit organisation Greener Transport Solution, also calls for a pay-per-mile scheme to be mandatory in 2030, but voluntary for EV owners from 20232.

The BVRLA’s latest Fleet Sustainability credentials3 reveal that whilst less than 1% (0.7%) of the total UK car parc is currently zero emission, 22% of salary sacrifice cars, 8% of company cars and 7% of car club cars are BEVs and its newly released Road to Zero Report Card4 confirms that most fleet car segments are now embracing EVs with enthusiasm. With the fleet sector playing a significant role in driving EV take up, it’s perhaps unsurprising that 27% of the UK’s public surveyed by Venson said that businesses operating EV fleets should incur additional charges.

Simon Staton, Client Management Director of Venson Automotive Solutions comments: “Whilst it’s not anticipated that plans for a new EV tax will be revealed by the Chancellor in his October Budget, there is pressure on him to outline a 10-year trajectory to establish a financially viable means to achieving zero emissions in the UK. However, our survey findings confirm an understanding by the public that some sort of EV tax or related user charges will be necessary, which should offer Government assurances that people are mentally preparing to make the switch, if they haven’t done so already.  A favourable tax regime, together with a raft of new models and significant growth in the charging network, will play a vital part in accelerating our journey along the road to zero.”

In a new white paper, ‘Living with your electric vehicle’, Venson shares insights, advice and examples that will help answer the multitude of questions for would be EV owners or fleet managers. The paper, which is free to download from the Venson website, looks at the most popular EV models available today; work, home and public charging options; and the details of how fleets can onboard EVs. It also covers the various financial incentives of EV ownership, many of which are set to end before 2030.

Download a copy of ‘Living with your electric vehicle’

Independent survey of 300 people conducted by Gorkana Surveys on behalf of Venson Automotive Solutions, September 2021