Electric cars were once seen as the tax-free solution to rising car costs, but that era is now coming to an end. Changes to UK electric car tax mean EV owners need to look closer at the true cost of ownership.
Here’s what’s changing, and what it means if you’re considering an electric or hybrid car.
Electric Cars and Road Tax: What’s New?
From April 2025, electric vehicles will no longer be exempt from Vehicle Excise Duty (VED). Instead, most EVs will now pay the standard annual rate to introduce the electric car tax. This applies to both new and existing electric vehicles, removing one of the financial incentives that originally encouraged EV adoption.
Luxury EVs and the “Expensive Car Supplement”
Another important update affects higher-value electric cars. From April 2026, the Expensive Car Supplement threshold for EVs rose. If your EV’s list price exceeds this threshold, you may still pay the additional supplement for several years, something many buyers overlook when budgeting.
This is particularly relevant for electric vehicles, where options and specifications can quickly push prices.
Mileage-Based Tax Is on the Horizon
Looking further ahead, the government has announced a pay-per-mile tax for electric and plug-in hybrid vehicles, expected in April 2028. These include:
Fully electric vehicles could be charged around 3p per mile
Plug-in hybrids around 1.5p per mile
For a typical EV driver covering 8,000–9,000 miles a year, this could add several hundred pounds to annual costs on top of existing road tax.
What This Means for Buyers
Electric cars are still an excellent option for many drivers, especially those doing high urban mileage, charging at home and benefiting from lower fuel costs.
However, it's important for buyers to look at:
Annual road tax
Potential mileage-based charges
Purchase price and depreciation
Charging access and habits
This shift may also soften used EV prices, which could be good news if you’re buying pre-owned rather than new. Our stock offers a range of pre-owned electric and hybrid vehicles - get in touch with our team to book a test drive.
Our Honest Take
At Prestige Cars Kent, we believe the right car depends on your lifestyle, not just government incentives. Whether that’s electric, hybrid or petrol, the key is understanding the full picture.
If you’d like to talk through your options without pressure or jargon, our team is always happy to help you find a car that genuinely fits your needs.