The Labour Party Chancellor Rachel Reeves has confirmed the start date for the controversial new car tax plan, set to charge drivers 3p per mile. Electric vehicle (EV) owners covering 10,000 miles annually could face an additional £300 each year, with the average motorist expected to pay around £250.
Chris Ball, CEO of financial advisory firm Hoxton Wealth, advises drivers to prepare financially: “If you drive 10,000 miles a year, this could mean an extra £300 annually. Planning by setting aside money monthly, tracking mileage, and reviewing vehicle expenses will be essential. Although EVs still promise long-term savings, it’s important to adjust expectations and factor these costs into budgets.”
The tax will not come into effect immediately but is scheduled for the start of the 2028 tax year—6 April 2028. This delay allows motorists some time to prepare but has already sparked concern among drivers.
One motorist lamented the impact on daily life, saying, “This will end weekend countryside trips and pub lunches. Small businesses and people barely managing financially will be hardest hit. Many will struggle to find the extra money—it feels like there’s no point in working anymore.”
Another EV owner voiced frustration: “We were encouraged to go electric to help the environment and secure the future. I’m taking delivery of my new EV in two weeks, but this Chancellor’s decision feels like a betrayal that undermines incentives to switch. Hopefully, common sense prevails before this policy goes through.”
James Court, head of policy at Octopus Electric Vehicles, warns the tax introduction is premature: “Introducing such charges too early risks damaging EV demand. Looking at other countries like New Zealand, early attempts to implement similar policies caused EV sales to plummet.”