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Electric Cars Will Have To Start Paying Road Tax

Jeremey Hunt the Chancellor has announced that all electric car owners will have to start paying vehicle road tax from 2025. Drivers that own petrol or diesel cars now could potentially see their running costs increasing far sooner, as there is a planned fuel rise in petrol and diesel in March 2023 adding around 12p a litre to the current price.

Electric vehicles will be charged for the lowest band for new cars in the first year which is currently at £10 and then they will start to pay the same rate as other road drivers. Drivers currently pay for newer diesel/petrol cars around ‘£120-£145’ in the first year then they pay £165 a year for the next 5 years.

Sales of new petrol and diesel cars and vans in the UK will be banned from 2030. Latest figures have shown from the Society of Motor Manufacturers and Traders show the rapid increase in sales of new pure electric cars has started to slow in recent months. The number of registrations during the first three months of the year was 102% more than during the same period and at the end of October 2022 the year-to-date increase had fallen 38.4%.

The Chancellor Jeremy Hunt told the Commons in his autumn statement: “Because the Office of Budget Responsibility forecast half of all new vehicles will be electric by 2025, to make our motoring tax system fairer I’ve decided that from then electric vehicles will no longer be exempt from vehicle excuse duty.”
“Company car tax rates will remain lower for electric vehicles and I will limit rate increases to 1% a year for three years from 2025.”