Was it inevitable? Perhaps.
Is the UK public happy about it? Perhaps not.
Is it necessary? We shall see!
In a move that has been named "short-sighted" by Ford UK's Chairman, Tim Slatter, Jeremy Hunt has announced that EVs will no longer be tax-free after 2025.
The Chancellor's plans mean electric cars will pay £10 for the first year, before leaping up to the standard rate of £165 after that. This rate applies to those EVs that registered after April 2017.
Introduction of road tax for EVs is "short-sighted" says Ford
What does this mean for electric company cars?
In the Autumn budget statement, Hunt said, “Company car tax rates will remain lower for electric vehicles and I've listened to industry bodies and we'll limit rate increases to one percentage point a year for three years from 2025.”
Why is it being introduced?
The government and Local Government Association support the introduction of car tax for EVs because despite being much less harmful than standard ICE vehicles, EVs still sit in traffic jams, cause congestion and lead to increased wear and tear on British roads.
Will it slow down the wide-scale introduction of EVs?
Making the switch to electric vehicles is getting easier and cheaper year after year. However, the initial cost of an EV is a higher investment than that of a petrol or diesel car, and perks such as no annual road tax helped to sweeten the deal.
There are many perks to owning an electric vehicle, including huge savings each month on the cost of fuel versus charging, but there are mixed reactions from companies on whether this will prevent them from switching to electric fleets.
The AA believes it will "slow the road to electrification", whereas the RAC states, "After many years of paying no car tax at all, it's probably fair the government gets owners of electric vehicles to start contributing to the upkeep of major roads from 2025."
Whether or not you agree, one thing is for certain: businesses that own electric vehicles or are looking to make the switch need to have on-site charge points. Charge And Recharge offers a smooth and efficient service, advising you on available grants, optimal locations for the charge points, as well as the best charger for your needs.
Get in touch today!