There’s confusion over how the Government plans to replace lost revenue from fuel duty as people move towards electric vehicles.
The Telegraph points out that in the Transport Decarbonisation Plan, the Government says it will need to ensure that “revenue from motoring taxes keeps pace” with the switch to electric vehicles “to ensure we can continue to fund the first-class public services and infrastructure that people and families across the UK expect”.
It points out that electric vehicles are currently not liable for vehicle excise duty and drivers don’t pay fuel duty, which could leave the Treasury with a £34 billion hole. The AA estimates that It would need to recoup £765 per car per year in lost fuel duty.
“You couldn’t put the extra costs on VED, because so many people just wouldn’t pay it,” Sir Edmund King, the AA president, told the paper. He further warned higher purchase taxes would be a disincentive for people to buy electric vehicles and taxing the electricity would be potentially regressive, saying some kind of pay as you go arrangement as the most obvious option.
“But that’s always been political suicide. It’s very difficult to sell something called road pricing to the public. They’ve got a dilemma, and they’re being very quiet about it,” he’s quoted as saying.
Furthermore there are questions over how electric vehicles will be charged, with the Government promising 6,000 ultra-rapid charge points, as well as more than £100 million to support on and off-street parking, but there are suggestions Britain needs 2.3 million public charging points in nine years’ time.
(Picture – Highways News)
