UK motorists support EV tax to plug £40bn black hole
The majority of motorists are supportive of a switch to a new financial solution to plug a £40bn tax black hole as EV adoption rises.
A survey of 300 motorists by Venson Automotive Solutions saw 87% agree there needs to be action to avoid a VED and fuel duty shortfall as a result of drivers choosing electric vehicles. In December 2020 HM Treasury’s Net Zero Review Interim Report said the Government would need to consider how to offset these lost tax revenues and the Transport Select Committee opened an inquiry.
But driver opinion on how this can be achieved is divided.
The most popular solution – chosen by 38% of respondents – is the introduction of a new Electric Vehicle tax that could see drivers of heavier vehicles, opposed to those with a greater engine size, paying heftier taxes.
Meanwhile, 32% of survey respondents said they would welcome a move to end free public EV charging points and 31% backed the introduction of a ‘Road Miles’ system which would see charges incurred by plug-in drivers with higher mileage use.
And 27% of people believe businesses operating EV fleets should incur additional costs.
Only 22% were in favour of a blanket per-mile nationwide road pricing approach.
Simon Staton, client management director of Venson Automotive Solutions, said: “Whilst it’s not anticipated that plans for a new EV tax will be revealed by the Chancellor in his October Budget, there is pressure on him to outline a 10-year trajectory to establish a financially viable means to achieving zero emissions in the UK.
“However, our survey findings confirm an understanding by the public that some sort of EV tax or related user charges will be necessary, which should offer government assurances that people are mentally preparing to make the switch, if they haven’t done so already.
“A favourable tax regime, together with a raft of new models and significant growth in the charging network, will play a vital part in accelerating our journey along the road to zero.”
The latest research from Venson comes on the back of the launch of its new white paper on ‘Living with your electric vehicle’. The paper, which is free to download from the Venson website, looks at the most popular EV models available today, charging options and details of how fleets can onboard EVs. It also covers the various financial incentives of EV ownership, many of which are set to end before 2030.
To access the Venson EV white paper, click here.