eVED explained: the UK pay per mile EV tax
From April 2028, electric cars in the UK will pay road tax by the mile. The consultation on how it will work closed in March 2026. Here is what has been decided, what is still open, and what it means for your money.
The basics in five sentences
Electric Vehicle Excise Duty is a new mileage charge announced at the November 2025 Budget. From April 2028, electric cars pay 3p per mile and plug-in hybrids pay 1.5p per mile, with the rates rising each year with CPI inflation. It is paid on top of normal road tax, not instead of it. The government set the EV rate at roughly half the fuel duty an average petrol driver pays per mile, so switching to electric still saves money. You can model your own bill with our pay per mile calculator.
Why it exists
Fuel duty funds a large slice of public spending, and every petrol car that becomes an electric car shrinks it. Without reform, fuel duty receipts are forecast to fall by around half by the 2030s. The government's position is that all cars cause road wear and congestion, so all drivers should contribute something on usage, not just those buying petrol. The Office for Budget Responsibility expects eVED to raise about £1.1 billion in its first year.
How paying will actually work
There are no trackers and no new tax system to learn. When you renew your VED, you estimate how many miles you expect to drive in the year ahead and pay the eVED alongside it, upfront or in instalments. At the end of the year you submit your actual mileage and the difference is settled, as a bill if you drove more or a credit if you drove less. The declared figure is checked against the odometer reading taken at the MOT. Cars under three years old, which have no MOT, would attend an accredited mileage check instead. The government will not collect data on where or when you drive, and any telematics-based reporting would be optional and opt-in only.
The details that catch people out
Four points from the consultation deserve attention. First, UK-registered cars pay for every mile on the odometer, including miles driven abroad, because the system reads distance, not location. Second, plug-in hybrids pay their reduced 1.5p rate and still pay fuel duty on the petrol they burn, so a PHEV pays twice, once per mile and once at the pump. Third, when a car is sold, any prepaid mileage credit or outstanding deficit transfers with the vehicle to the new owner, and the DVLA will show a car's eVED position online, so checking it becomes part of buying a used EV. Fourth, only cars are in scope. Vans, motorcycles, buses, and coaches are excluded at launch.
What it costs in practice
A typical driver covering 8,500 miles a year pays about £255 in eVED. Add the standard VED rate and the total road tax for an average EV lands around £455 a year, more if the car attracts the Expensive Car Supplement. For comparison, the average petrol driver pays roughly £480 a year in fuel duty alone at around 6p per mile, before adding their own VED. A high-mileage EV driver at 20,000 miles pays £600 in eVED, still around half the fuel duty equivalent. In every case, cheap home charging remains the bigger factor in the total cost, which our calculator puts side by side with a petrol car.
What could still change
This is a proposal with a consultation completed, not law. The consultation closed on 18 March 2026 and asked 16 design questions, and the government response is expected later in 2026, with legislation to follow before the April 2028 start. The responses published so far show where the pressure is. Accountancy body ICAEW warned that estimation, reconciliation, and self-reporting for millions of drivers creates compliance risk, called for a penalty-free first year, and flagged the unfairness of a used-car buyer inheriting the seller's mileage position. Energy sector body Energy UK urged the government not to implement it before the 2030 ZEV mandate targets are met, arguing it could slow EV uptake at the steepest point of the transition. The rates, the penalty regime, and the treatment of leased and fleet vehicles are the areas most likely to be refined. This page will be updated when the government response lands.
What to do now
Nothing urgent, but two things are worth doing. If you are choosing between an EV and a petrol car, run your own numbers with eVED included rather than relying on headlines, since for most home-charging drivers the EV still wins comfortably. If you are signing a lease or salary sacrifice contract that runs past April 2028, ask how the provider intends to handle eVED, because for leased cars the leasing company is the registered keeper and will be the one paying it, then recovering it from you.
Sources: HM Treasury, Consultation on the Introduction of Electric Vehicle Excise Duty (GOV.UK); Autumn Budget 2025 documents; OBR forecasts; published consultation responses from ICAEW and Energy UK. General information, not tax or financial advice.