A new 3p per mile car tax for electric vehicles (EVs), introduced by the Labour Party, will impose higher charges on drivers who under-declare their mileage. The government’s pay-per-mile plan requires motorists to estimate their annual mileage and pay upfront or spread payments throughout the year, with a mandatory year-end reconciliation based on actual miles driven.
Mileage submissions will be verified annually, typically during MOT checks or, for newer vehicles, around their first and second registration anniversaries. However, the government acknowledges that discrepancies between mileage reporting periods and MOT inspections could allow some drivers to submit inaccurate readings without immediate detection.
Under-reporting mileage carries the risk of increased tax rates in subsequent years. Since odometer readings impact the vehicle’s resale value and are recorded during scrappage, any under-declaration will eventually be uncovered. The DVLA is exploring further measures to reduce delays in reporting and payment.
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Industry experts warn that this tax could discourage EV adoption, especially impacting those without home chargers. Delvin Lane, CEO of InstaVolt, highlights that current charges on public EV charging place a heavier burden on rural and low-income drivers. He calls for the government to collaborate with automotive and charging sectors to develop a fair and sustainable system that promotes zero-emission vehicles while ensuring effective road taxation.