Why the Proposed Pay-Per-Mile tax for electric vehicles UK EVs is a Misstep
Updated: 4 days ago
(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. We also support 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 3p per mile on top of existing Vehicle Excise Duty (VED) and other levies. This could effectively mean 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. It 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 in the first year and £195 thereafter. 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. This includes the rapid growth of charging networks, workplace and fleet electrification, and public charge-point roll-outs. The phasing out of petrol and diesel new car sales by 2035 (or earlier) is also part of this transition. Introducing a mileage tax on EVs sends a confusing message: invest in electrification, reduce emissions — but pay more. This 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 the 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 the uptake of EVs. This, in turn, would reduce the 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. We need to address public charger availability, especially for those without home parking. Additionally, levelling VAT treatment on public charge-points and supporting business and workplace installations is crucial. 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 the total cost of ownership increases due to new mileage taxes, decision-makers may delay or avoid electrification. This could slow demand for our services, harm network scaling, and reduce the UK’s progress to net zero.
Swift Charging’s Take: What Needs to Happen Instead
Prioritise Charging Infrastructure Rollout: Focus on workplace, fleet, public, and home charging rather than penalising EV adoption.
Remove Unfair Tax Burdens: Equalise VAT for public chargers to create a fairer environment.
Introduce Business-Friendly Incentives: Offer zero upfront installations, revenue-share models, and maintenance contracts — exactly what Swift Charging provides.
Ensure Fair and Transparent Tax Reform: Any future motoring tax reform should distinguish between private commuter use, commercial fleets, workplace charging, and high-usage vehicles.
Keep the UK Competitive: Businesses will electrify (workplaces, fleets, public sites) only if charging costs and operating models make sense.
The Future of EV Charging in the UK
The future of EV charging in the UK hinges on strategic decisions made today. As we move towards a greener future, it is essential to create an environment that fosters innovation and investment in EV infrastructure. The proposed pay-per-mile scheme could stifle this growth and deter potential adopters.
The Importance of Collaboration
Collaboration between the government, businesses, and charging network operators is crucial. By working together, we can create a robust charging ecosystem that supports the transition to electric vehicles. This collaboration can lead to innovative solutions that benefit all stakeholders involved.
Emphasising Sustainability
Sustainability should be at the forefront of our efforts. By prioritising the development of charging infrastructure, we can ensure that the transition to electric vehicles is not only smooth but also beneficial for the environment.
The Role of Technology in EV Charging
1. Advancements in Charging Technology
Technological advancements are crucial for the future of EV charging. Innovations in fast-charging technology can significantly reduce charging times. This makes EVs more convenient for users. Moreover, smart charging solutions can optimise energy use, reducing costs and enhancing efficiency.
2. Integration with Renewable Energy Sources
Integrating EV charging with renewable energy sources is vital. Solar and wind energy can power charging stations, making them more sustainable. This not only reduces the carbon footprint of EVs but also aligns with the UK’s net-zero goals.
3. The Future of Smart Grids
Smart grids will play a significant role in the future of EV charging. These grids can manage energy distribution more effectively. They can balance supply and demand, ensuring that charging stations operate efficiently. This technology will be essential for accommodating the growing number of EVs on the road.
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.