The UK government has confirmed that its new mileage-based tax on electric vehicles (EVs)—called electric Vehicle Excise Duty (eVED)—will begin in April 2028, charging drivers £0.03 per mile and plug-in hybrid drivers £0.015 per mile on top of standard VED. The rates emerged from a consultation that ran from November 2025 to March 2026 and drew more than 5,000 responses, prompting ministers to simplify several of the scheme’s original requirements.

The most significant change scraps a proposed requirement for additional mileage verification checks on vehicles less than three years old, which are not yet subject to annual MOT inspections. Instead, private motorists will submit an odometer reading and an estimated annual mileage figure when renewing their VED, with the DVLA calculating a provisional eVED liability which is later reconciled against official records. A voluntary connected car option will also let drivers submit mileage data directly from their vehicle’s own systems.

Fleet operators, rental firms and leasing companies secured their own concessions, including the ability to submit estimated mileage centrally rather than relying on individual drivers and the option to settle any outstanding eVED liability with a top-up payment before a vehicle is sold, addressing industry concerns that unresolved charges could distort residual values. The British Vehicle Rental and Leasing Association (BVRLA) had estimated the original design would cost the fleet sector around £260m (US$348.5m) a year in compliance costs.

Despite the numerous adjustments, industry reaction remains decidedly mixed. BVRLA Chief Executive Toby Poston welcomed the simplifications while maintaining opposition to the tax itself, saying: “You can’t create a smooth switch to EVs by making them more expensive to own […] the mechanics of the tax may have improved, but the timing is still wrong.” Meanwhile Vicky Edmonds, Chief Executive of Electric Vehicle Association England, said the wider scheme “remains too complex, risks leaving people out of pocket and fails to give drivers the confidence they need.”

One design choice has drawn particular criticism: charging drivers based on location would require using location data, raising privacy concerns, and EV owners will pay eVED on mileage driven abroad as well as at home. Officials estimate only around 2% of UK cars’ annual mileage is accumulated overseas.

The tax is expected to raise £1.1bn in 2028-29, rising to £1.9bn by 2030-31, from an estimated six million EV drivers by the time it takes effect. A typical EV driver would pay around £240 a year, still less than the £480-600 drivers currently pay in fuel duty. Around 80% of the revenue is earmarked to support the government’s broader electrification initiatives, coming in at £7.5bn over the next decade, including grants of up to £3,750 toward new purchases of qualifying EVs.

The impact will not be felt uniformly across the UK: a tax designed to make EV ownership equivalent to gasoline-powered motoring risks reproducing the same geographic unfairness that already exists in the country’s charging infrastructure.

In fact, it may affect buyers generally less inclined or able to purchase an EV the most—in other words, the ones that the government still needs to win over. Analysis by leasing group The Electric Car Scheme found the flat £0.03 per mile rate will hit rural drivers hardest regardless of income or need, while south-west England motorists facing roughly £110 a year in extra charges against just £33 for Londoners. The Office for Budget Responsibility has linked this gap to a projected 440,000 fewer EV sales over five years.