Electric vehicle owners will pay car tax from 2025 to offset falling revenues from the slow decline of petrol and diesel vehicles ahead of their planned phaseout at the end of the decade by the UK government.
Chancellor Jeremy Hunt said on Thursday that the exemption for battery-powered cars from vehicle excise duty, known as car tax, would end in April 2025.
The decision removes one of the remaining tax advantages of owning a zero emission vehicle, which remain more expensive than traditional combustion engine equivalents. The plug-in car grant, which initially gave motorists up to £5,000 off the price of a new electric car, was finally scrapped earlier this year.
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