Levy Supplement on ‘Luxury’ Electric Cars ‘At Odds’ With Net Zero Strategy: Tax Analysts

A tax levied on “luxury” electric cars, coming into force next year, is “at odds” with the government’s net zero ambition, a business advisory firm has said. Electric vehicles (EVs) registered on or after Apr. 1, 2025 and worth more than £40,000 will be taxed in line with government policies. The current rate amounts to £410 a year, from the second to sixth year of the vehicle’s registration. In addition, changes to Vehicle Excise Duty (VED), coming into effect next year mean that EV owners will have to pay for road tax for the first time. In the first year, new EVs will pay the lowest VED rate of £10 a year, followed by £190 from the second year onward. This means that the total road tax bill for EV drivers with an “expensive” car will go up to £600 a year....