Select says EV tax changes disappointing – but inevitable

IN the Autumn Statement (17 November) Chancellor Jeremy Hunt announced that electric vehicles will now attract VED.

But David Lewis (above), head of electric vehicles & energy at Select Car Leasing, said the move was ‘disappointing – but inevitable’.

He added:

“It was always inevitable that EV owners would one day have to pay vehicle excise duty or a similar tax so this doesn’t come as a great surprise.

“Road tax generates billions for the Treasury each year – and as more and more people move to EVs, that’s a large fiscal gap to plug.

“In my view EV road tax has been brought in at least two, three years ahead of time, as a reaction to a challenging financial outlook.

“And while that’s disappointing on the face of it – and an embarrassing announcement to make during COP27 – I don’t ultimately see this as being a ‘deal-breaker’ for those looking to get behind the wheel of an EV.

“The first year VED for zero emission cars from 2025 will be set at the lowest rate – £10 – before moving to the standard rate of £165 a year.

“There’s also good news for company car owners, too. Jeremy Hunt has promised to keep Benefit in Kind (BIK) rates for EVs low, with a small 1% per year increase from April 2025, for three years.

“We know from our own data that more and more people are leasing an EV as a company car, taking advantage of low tax rates and company Salary Sacrifice schemes, so that’s a welcome step.

“Since the summer alone, business lease enquiries at Select Car Leasing have increased by 24%. That’s a significant rise that reflects the growing appetite for overall, and our Fleet Solutions team is working hard for businesses across the UK.

“And from a leasing perspective, I’d urge anyone looking to drive an EV to act now before the VED rules apply in three years’ time.”