LONDON / RankWire.AI / – The UK government has advanced its plans for an electric vehicle pay-per-mile levy by releasing its consultation feedback and preliminary legislation. HM Treasury published these documents on July 13, setting April 1, 2028, as the scheduled start date. Named Electric Vehicle Excise Duty, this measure will impose a mileage-based charge on top of the annual vehicle tax for qualifying cars. A technical consultation on the draft provisions will close on Sept. 7, 2026.
Battery-electric and hydrogen fuel cell vehicles will be charged 3 pence per mile traveled. Plug-in hybrid vehicles will pay 1.5 pence per mile because their petrol or diesel use is also subject to fuel duty. These rates are set to increase with consumer price inflation from the 2029-30 tax year. At the initial rate, driving 8,000 miles would cost an electric vehicle owner £240 annually. Covering 10,000 miles would amount to £300. This additional cost will be paid alongside the existing Vehicle Excise Duty.
Vehicle owners will be required to submit odometer readings when renewing their vehicle tax and will also estimate their mileage for the upcoming tax period, typically one year. They may choose to pay the estimated amount upfront or distribute payments throughout the year. The Driver and Vehicle Licensing Agency will later compare actual odometer readings with the estimates and adjust the payable amount accordingly. For vehicles already undergoing annual MOT testing, existing records will be used for verification. The new process will integrate with the current vehicle tax system.
Mileage Reporting to Prevent Unnecessary Inspections
The government has dropped its earlier proposal to conduct separate mileage checks for vehicles that are not yet due for MOT testing. Instead, owners of such vehicles will report their mileage and provide an annual estimate. The first MOT will produce a verified odometer reading to compare with previous submissions. Most vehicles in Great Britain undergo MOT testing after three years, while Northern Ireland’s vehicles typically do so after four years. Authorities may still order checks if there is reasonable suspicion of fraud or noncompliance.
This scheme will not mandate the use of tracking devices or record individual trips. Mileage accumulated outside the UK will count since the charge is based on total odometer distance. Initial coverage includes battery-electric cars, plug-in hybrids, and hydrogen fuel cell vehicles. However, electric vans, buses, coaches, and heavy goods vehicles will be excluded at launch. Drivers might later opt for an optional system that uses mileage data from connected vehicles.
Details of Implementation Outlined in Consultation Response
The consultation period ran from Nov. 26, 2025, to March 18, 2026, drawing 5,133 responses. While 92% of submissions came from individuals, businesses and public bodies also participated. Concerns raised included administrative procedures, mileage verification, flexible payment options, fleet management, and odometer fraud prevention. The revised plan allows fleets and leasing companies to submit estimated readings and utilize bulk licensing. It also offers more adaptable payment options for organizations managing large vehicle fleets.
Government forecasts indicate that approximately 5.6 million vehicles will be subject to the tax in the 2028-29 fiscal year. The Office for Budget Responsibility has approved revenue estimates of £1.1 billion for that period. Revenues are projected to increase to £1.435 billion in 2029-30 and reach £1.865 billion in 2030-31. The implementation process now covers legislation, payment infrastructure, mileage verification, refunds, penalties, appeals, and dispute resolution. Motorists will start paying this tax when they renew their vehicle registration after April 1, 2028.