Why the Proposed Pay-Per-Mile tax for electric vehicles UK EVs is a Misstep
- Swift Charging
- 1 day ago
- 4 min read
(and why Swift Charging believes it’s counter-productive for the UK’s EV transition)
Introduction to Pay-Per-Mile Tax for Electric Vehicles UK
As an EV charging network and charge-point operator delivering end-to-end solutions for workplaces, fleets, public and commercial sites, Swift Charging welcomes efforts to fund the UK’s road infrastructure and ensure fairness in motoring taxation. However, we believe the latest signals that the government may introduce a “pay-per-mile” tax (or “paper-mile tax”) on electric vehicles (EVs) are fundamentally at odds with the UK’s net-zero ambitions and the rapid growth of EV charging infrastructure.
Current speculation suggests that from around 2028, electric car drivers could face an additional charge of around 3 p per mile on top of existing Vehicle Excise Duty (VED) and other levies – effectively an extra ~£250 per year for many drivers. The Guardian+2The Scotsman+2 While we recognise the UK Government faces a revenue gap as fuel duty receipts fall, Swift Charging believes this move is poorly timed, risks undermining business investment in EV infrastructure, and sends the wrong signal to businesses, fleets and workplaces looking to electrify.
What are the Facts?
Here’s a summary of what is known so far about the proposed scheme:
The UK’s Chancellor is reported to be “considering introducing” a pay-per-mile tax on EVs, to help plug the gap left by declining fuel duty revenue. The Guardian+1
Reports suggest an extra charge of 3p per mile from 2028 for EV drivers could be on the table. GB News+1
The average extra annual cost could be around £250 for many EV drivers. The Guardian+1
From April 2025, EVs that were previously exempt from VED are now subject to standard rates: new EVs pay £10 first year and £195 thereafter, and the expensive car supplement for EVs (list price >£40,000) was reinstated. The Electric Car Scheme+1
The tax reform discussions acknowledge that as more drivers switch to EVs, the traditional fuel duty model becomes less tenable — the UK Treasury is seeking alternative revenue streams. Financial Times+1
Why Swift Charging Believes This Is Counter-Productive
1. It undermines the transition to EVs
We are in the midst of a major infrastructure build-out: rapid growth of charging networks, workplace and fleet electrification, public charge-point roll-outs, and the phasing out of petrol/diesel new car sales by 2035 (or earlier). Introducing a mileage tax on EVs sends a confusing message: invest in electrification, reduce emissions — but pay more. That runs counter to clear policy goals and risks chilling commercial investment in EV charging infrastructure (which is what we deliver).
2. It ignores user-type and context differences
A straight per-mile charge of 3p would hit rural drivers, fleet users, commercial site operators, workplace chargers and public network users in very different ways. Someone commuting 30 miles a day for work, or a fleet based in a remote location, could be disproportionately affected. Without differentiation (workplace charging, business fleets, public chargers, semi-public sites) the tax would risk being seen as unfair. Critics have already raised this point. The Scotsman+1
3. It adds to cost pressures in EV charging ecosystem
For workplace charging, public charging, fleet charging and commercial installations — which Swift Charging supports — controlling operational costs is vital. If drivers and businesses anticipate increased mileage-based fees, it could dampen uptake of EVs and thus reduce utilisation of charge points, undermining business models and reducing the revenue potential of charging networks.
4. It’s the wrong lever at the wrong time
Instead of penalising EV drivers with a new tax, the focus should be on accelerating charging infrastructure deployment, addressing public charger availability (especially for those without home parking), levelling VAT treatment on public charge-points, and supporting business & workplace installations. For instance, EV drivers already face higher VAT on public charging (20 %) compared to home electricity (5 %). The Guardian A mileage tax risks becoming a deterrent rather than a motivator.
5. It could hamper the business case for workplace and fleet EV charging
Swift Charging works with businesses installing workplace charge-points, fleets switching to EVs, and commercial and public site installations. These customers need cost certainty and incentives, not growing taxation. If total cost of ownership increases due to new mileage taxes, decision-makers may delay or avoid electrification — slowing demand for our services, harming network scaling, and reducing the UK’s progress to net zero.
Swift Charging’s Take: What Needs to Happen Instead
Prioritise charging infrastructure rollout (workplace, fleet, public, home) rather than penalising EV adoption.
Remove unfair tax burdens on public charging and commercial sites, e.g., equalise VAT for public chargers.
Introduce business-friendly incentives (zero upfront installations, revenue-share models, maintenance contracts) — exactly what Swift Charging offers.
Ensure any future motoring tax reform is fair, transparent and phased, distinguishing between private commuter use, commercial fleets, workplace charging, and high-usage vehicles.
Keep the UK competitive in the EV transition — because businesses will electrify (workplaces, fleets, public sites) only if charging costs and operating models make sense.
Final Word
At Swift Charging, we believe that now is the time for investment, acceleration and scaling of EV infrastructure — not the time to penalise it with a one-size-fits-all per-mile tax. The proposed pay-per-mile scheme may make sense from a Treasury revenue perspective, but it risks slowing business demand, undermining workplace and fleet electrification, and creating uncertainty across the charging ecosystem.
For businesses, workplaces and fleets exploring EV charging solutions, the message is clear: ensure your business has a forward-looking partner that understands the economics, the grants (such as OZEV Grants), the network build-out, and can provide the right end-to-end charging strategy. Swift Charging is that partner: nationwide coverage, zero upfront installations, full software and app white-label capabilities, and maintenance + revenue-share models.
Policy may shift; progress shouldn’t. EV charging still drives savings, sustainability credentials, and footfall. Swift Charging delivers end-to-end—strategy, install, software, billing, and aftercare—so your sites keep earning while you stay focused on growth.
Ready to accelerate? Talk to our team on 0204 548 3032 or ev@swiftcharging.co.uk.
