Chancellor signposts road tax for electric vehicles from 2025

James Warwick, tax partner at Deloitte, said:

“Today the Chancellor of the exchequer announced two changes in relation to Electric Vehicles.

“From April 2025, owners of EVs will begin paying Vehicle Excise Duty (road tax) in the same way as traditional combustion engine vehicles owners do. This puts the brakes on both cost and emissions reducing incentives for EVs.

“However, the second change represented a continued commitment to encouraging EV adoption through company car schemes. Benefit in kind (BIK) rates for EVs will rise from the current rate of 2%, going up 1% per year from April 2025 to 5% by the 2027/28 tax year. Signposting the road ahead for BIK rates is particularly important for these schemes where it is common for lease commitments to extend 3-4 years ahead. Commitment to low rates for the medium-term will maintain the very strong economic incentive for employers to offer EV schemes and for employees to take them up.”

Note to editors

You can follow us on Twitter: 

@DeloitteUK for live comment

Deloitte spokespeople

Deloitte has a range of spokespeople available to comment on today’s Autumn Statement. They can be reached on 020 7007 3333 or 0207 303 5054 or one of the following numbers:

• Debapratim De - senior economist (07884 765916)

• Amanda Tickel - head of tax policy (07920 270 964)

• Rachel McEleney - personal tax (07826 891 752)

• Alison Lobb - corporate tax (07768 178264)

• James Warwick - employment tax (07855 399368/07436055437)

• Gareth Pritchard - indirect tax (07824895798)

• Gerry Biddle - business rates (07855 399 368)

About Deloitte

In this press release references to “Deloitte” are references to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”) a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see deloitte.com/about for a detailed description of the legal structure of DTTL and its member firms.

Deloitte LLP is a subsidiary of Deloitte NSE LLP, which is a member firm of DTTL, and is among the UK's leading professional services firms.

The information contained in this press release is correct at the time of going to press.

For more information, please visit www.deloitte.co.uk.