How Much Is the Pay Per Mile Electric Car Tax?

Key takeaways

• Electric Vehicle Excise Duty runs at 3p a mile for battery electric cars and 1.5p for plug-in hybrids from 1 April 2028, so 10,000 miles costs £300 or £150.
• The government's own worked example has a driver estimating 5,000 miles and paying £150 up front. Under the draft legislation, paying by instalments costs 105% of the charge.
• 3p a mile is the Fuel Duty a petrol car doing 80.2 mpg pays at the 52.95p a litre rate in force to 31 December 2026. DfT's latest new-petrol figure is 52.6 mpg.
• The Treasury calls 3p half the equivalent Fuel Duty rate. That holds at 44 mpg against the 57.95p rate, not against the 52.95p rate drivers pay today.
• Battery electric cars in England averaged 9,400 miles in 2025 against 6,200 for petrol, so an average electric car faces £282 of eVED a year.

What the pay per mile electric car tax costs at four annual mileages

From 1 April 2028 a battery electric car pays 3p for every mile it is driven, and a plug-in hybrid pays 1.5p. That's on top of the vehicle tax it already pays. HMRC's policy paper, published on 13 July 2026, puts the operative date plainly: "This change will have effect from 1 April 2028." So the pay per mile electric car tax is simple multiplication, and here's what it comes to.

The 5,000-mile row isn't our invention. It is the government's own illustration, in Annex C of the consultation response: "A motorist initially estimates they will drive 5,000 miles over the licensing period and pays the annual tax of £150 in one payment at the start of the year."

Two things explain the two Fuel Duty columns. Duty on unleaded petrol is 52.95p a litre until 31 December 2026, and HMRC's amended rates paper of 22 May 2026 sets a legislative default of 55.95p from 1 January 2027 and 57.95p from 1 March 2027. The same paper says the government "will confirm final rates at Budget 2026", which the Chancellor has set for 28 October 2026. So the right-hand column is a default, not a certainty.

Three pence a mile is the duty a petrol car doing 80 mpg pays

Converting a duty per litre into a duty per mile needs one constant. The Weights and Measures Act 1985 fixes the imperial gallon at 4.54609 litres, so 52.95p a litre is 240.7p of duty on every gallon burned. Divide that by 3p and you get the fuel economy at which a petrol car hands over exactly 3p of duty per mile: 80.2 mpg.

No mainstream petrol car gets near that. The most recent figure DfT published in table ENV0103 for new petrol cars was 52.6 mpg, for 2020. That is a registration-weighted number the department says is "obtained under consistent, carefully controlled laboratory conditions", so real-world economy sits below it.

At the 57.95p default the break-even rises to 87.8 mpg. For a plug-in hybrid at 1.5p a mile, the equivalent is 160.5 mpg at today's rate. Put the other way round, on duty alone the ev pay per mile tax is a long way short of what a petrol driver pays over the same road.

Where the claim that 3p is half the Fuel Duty rate stops holding

The consultation response makes a specific comparison: eVED "will be set at 3 pence per mile for electric cars, which is half of the equivalent rate of fuel duty, and 1.5 pence per mile for plug-in hybrid cars." That claim is testable, and it depends entirely on which petrol car and which duty rate you pick.

At 44 mpg and 57.95p a litre, a petrol car pays 5.99p of duty a mile. Three pence is 50.1% of that, so the Treasury's arithmetic checks out against the rate the schedule returns to on 1 March 2027. Against the 52.95p rate actually in force now, 3p is 54.8% of the same car's duty. And against DfT's 52.6 mpg laboratory figure at 57.95p, 3p is 59.9%. The word "half" is doing some work.

None of this makes eVED expensive relative to fuel. It makes the comparator worth naming. The Treasury's "half" is measured against a car that does roughly 44 to the gallon, on a duty rate that doesn't yet apply.

Vehicle tax does not go away, and paying monthly costs 5% more

eVED is an extension of Vehicle Excise Duty, not a replacement for it. A car registered on or after 1 April 2017 pays a standard rate of £200 for a single 12-month payment in 2026 to 2027, electric or not. Add eVED at 10,000 miles and the annual bill is £500.

The Expensive Car Supplement bites harder. A car with a list price over £40,000, or over £50,000 for an electric one, pays an extra £440 a year for five years from the second time it is taxed, taking the 12-month total to £640. A £50,000-plus electric car doing 10,000 miles would therefore face £940 a year in vehicle taxes. Zero-emission cars still pay only £10 in first-year VED.

The draft legislation adds a cost most coverage has skipped. Where eVED on a 12-month licence is paid "by more than one instalment", the amount due is "105% of the eVED charge". On 10,000 miles that turns £300 into £315. A six-month licence is charged at 110% of the eVED charge unless it is paid by direct debit, in which case it drops back to 105%. Spreading the payment isn't free.

Underestimating isn't penalised as such, but it is reconciled. Drive more than you estimated and the shortfall is collected at the next renewal. Drive less and the credit is carried forward rather than refunded. A refund for an unexpected change in financial circumstances is available, with the first condition being that "the refund requested is in excess of £100". The penalty for using or keeping an unlicensed car is scaled by mileage too: the draft deems the duty chargeable to be the annual rate plus the per-mile rate "multiplied by 8000", which is £240 of eVED at 3p.

Electric cars in England already do 9,400 miles a year against 6,200 for petrol

A per-mile tax only lands where the miles are, and the miles aren't evenly spread. DfT's National Travel Survey table NTS0901a, updated on 10 September 2026, puts average annual mileage in England in 2025 at 9,400 miles for battery electric cars, 8,000 for diesel, 7,100 across all cars and 6,200 for petrol.

So the average electric car travels 52% further than the average petrol car. At 3p a mile that's £282 of eVED. The average petrol car, over its shorter 6,200 miles at 44 mpg and 52.95p a litre, pays about £339 of Fuel Duty. The gap between the two typical cars is far narrower than the gap between the two headline rates, because the electric car is driven more. An average car of any fuel, on 7,100 miles, would owe £213.

There's a reading of that which cuts the other way. The 9,400-mile average is a feature of today's electric fleet, not a law of physics, and it comes from a survey of 11,918 cars in which, as DfT's own note says, "Total annual mileage is estimated by the respondent." The same table gives no figure at all for plug-in hybrids in 2025, marking the cell as data "of low quality due to small sample sizes". The 1.5p rate has no published mileage to sit against.

Most cars never reach the mileage that makes the bill large

Table NTS0904 breaks English cars into annual mileage bands, and the shape of it matters more than the average. In 2025 the largest single band was 5,000 to 6,999 miles, at 24% of cars. Add the bands below it and 31% of cars did under 5,000 miles a year. Cumulatively, 71% did under 9,000.

At the other end, only 7% of cars covered 15,000 miles or more. The £450 figure in the table above is a real number for a real group of drivers, but it's a small group. For the 71% below 9,000 miles, eVED lands under £270 a year.

That distribution is why a flat per-mile charge behaves differently from a flat annual charge. It also means the published averages hide the drivers with the strongest objection. The consultation response acknowledges "the impact of eVED on groups with a greater reliance on private vehicles", and answers that the design "is intended to mirror the contribution made by drivers of petrol and diesel vehicles through fuel duty, for which these groups are not exempt". HMRC expects the measure to touch "around 5.6 million vehicles in the financial year 2028 to 2029".

What is settled about the pay per mile electric car tax uk wide, and what is not

Settled, as of 15 October 2026: the rates, the start date, the scope and the mechanism. The rates sit in the draft legislation as a "per-mile rate" of "3p" for a zero-emission vehicle and "1.5p" for a plug-in hybrid. Hydrogen fuel cell cars are charged at the electric rate, range extenders at the plug-in hybrid rate. Vans, buses, coaches and HGVs are "out of scope of the tax upon its introduction". The rate is uprated from 2029 to 2030 "in line with Consumer Prices Inflation (CPI)".

Not settled: the draft legislation is still draft. HMRC's policy paper says primary legislation amending the Vehicle Excise and Registration Act 1994 "will be introduced", and the response document invites comments "to ensure the legislation operates as intended". The Fuel Duty comparison is less settled still. The 55.95p and 57.95p steps are a legislative default that the Budget on 28 October 2026 can change, as the May 2026 paper already changed the schedule set at Budget 2025.

Anything you read about what that Budget might do to either tax is reporting, not rule. Every figure above runs on the rules as published.

What the charge does not fix

The policy objective is revenue, and the revenue problem is bigger than the charge. The OBR expects Fuel Duty to raise £24 billion in 2025-26, "equivalent to £835 per household and 0.8 per cent of national income", peaking at £26.3 billion in 2028-29 before the electric transition pulls it down. In its July 2026 Fiscal risks and sustainability report, the OBR describes eVED as "offsetting around a quarter of fuel duty revenue losses". The other three quarters of the loss is not offset by it.

The counter-argument on uptake deserves a hearing too, and HMRC gives it one. The OBR assessed that eVED and the related Budget 2025 measures "would reduce EV sales by around 120,000 between financial years 2025 to 2026 and 2030 to 2031", which "represents only 2% of total anticipated EV sales during that period". HMRC also concedes that some owners "could be expected to keep their petrol and diesel vehicles longer, which in turn could lead to higher greenhouse gas emissions over time". The consultation drew 5,133 responses, 92% of them from individuals, and uptake was one of the two main concerns raised.

Two limits on everything above. The Fuel Duty columns compare duty with duty. They ignore the 20% VAT charged on the pump price, of which duty was 30.2% in the week commencing 12 October 2026, at an average 175.28p a litre. And they compare a 2028 charge against 2026 duty rates, because the 2028 Fuel Duty rate doesn't exist yet. Running a per-mile charge beside a per-litre one always means choosing a car, and the choice moves the answer. If you track motoring costs in LedgerTouch, annual mileage is the input worth keeping current.

What would change these numbers

Three things, in order of how soon they could move. The Budget on 28 October 2026 can reset the Fuel Duty path, and HMRC has already said final rates are for that event. If the 5p cut is extended again, the petrol columns fall and the gap narrows. Second, the first CPI uprating in 2029 to 2030 lifts 3p and 1.5p without any further announcement, so the real cost depends on inflation between now and then. Third, the draft is still open to change, and the instalment surcharges and the £100 refund floor are the details most likely to shift between a draft and an Act.

The one number that would change the conclusion rather than the arithmetic is fuel economy. If the petrol fleet's real-world economy sits closer to 35 mpg than 44, the Treasury's "half" understates the discount electric drivers get, and the honest break-even moves further from 80 mpg. DfT stopped updating its new-car fuel consumption table after the 2020 data, which is exactly the figure anyone comparing these two taxes needs most. For the rest of the cost of running a car, the PCP vs HP vs lease arithmetic covers the part of the bill that doesn't depend on mileage, and the electricity VAT cut covers the one that does. Commuters pricing the whole journey may want the bus fare cap numbers beside them.