LONDON / RankWire.AI / – The UK government has moved its planned pay-per-mile tax for electric vehicles closer to Parliament. HM Treasury published its consultation response and draft clauses on July 13. The measure is called Electric Vehicle Excise Duty, or eVED. It would start on April 1, 2028, and operate alongside existing Vehicle Excise Duty. A technical consultation on the draft legislation runs until Sept. 7, 2026. Parliament must approve the final law before the system can begin.
Battery electric and hydrogen fuel cell cars would pay 3 pence for every mile traveled. Plug-in hybrids would pay 1.5 pence per mile. Their lower rate reflects the fuel duty already paid when they use petrol or diesel. An electric car covering 8,000 miles would incur £240 a year under the opening rate. Ten thousand miles would cost £300. The government plans to increase the rates with consumer price inflation from the 2029-30 tax year.
Drivers would report an odometer reading when they renew their annual vehicle tax. They would also estimate mileage for the next licensing period, usually one year. Motorists could pay the estimated charge upfront or spread payments through the year. The Driver and Vehicle Licensing Agency would compare the next reading with the estimate. It would then calculate any extra payment or credit. Existing MOT records would support mileage checks for cars that already undergo annual testing.
Extra checks removed for newer cars
The government has removed a proposed requirement for extra mileage inspections on newer cars. Most cars in Great Britain do not need an MOT until their third anniversary. Northern Ireland generally requires the first test after four years. Owners of younger vehicles would instead submit their own readings and annual estimates. The first MOT would provide verified mileage for comparison. Officials could still require a check when they reasonably suspect fraud or inaccurate reporting.
The plan does not require tracking devices and does not record individual journeys. Mileage outside the UK would still count for UK-registered cars because the charge uses total odometer distance. The initial scheme covers battery electric, plug-in hybrid and hydrogen fuel cell cars. Electric vans, motorcycles, buses, coaches and heavy goods vehicles remain outside its scope. Connected-car mileage reporting would remain optional. Drivers who choose it could send readings through their vehicle’s built-in data connection.
Consultation changes fleet arrangements
The consultation ran from Nov. 26, 2025, through March 18, 2026, and received 5,133 responses. Individuals submitted 92% of them. Respondents raised concerns about payment systems, mileage checks, fraud, fleets and administrative work. The revised design gives leasing and rental businesses access to central mileage estimates, bulk licensing and more flexible payments. The government also plans guidance and digital tools for motorists. Those materials would explain mileage estimates, adjustments, refunds, penalties and appeals.
Official estimates show eVED would affect about 5.6 million vehicles in the 2028-29 financial year. The Office for Budget Responsibility certified projected revenue of £1.1 billion for that year. Receipts rise to £1.435 billion in 2029-30 and £1.865 billion in 2030-31. Drivers would begin paying when they first renew vehicle tax after April 1, 2028. Work now covers final legislation, licensing systems, mileage verification, payment rules and enforcement procedures. The draft remains subject to the parliamentary process.