A driver with a driveway who covers the average 7,400 miles a year will pay £243 more a year to run an electric car by 2028-29 because of the Autumn Budget 2026, up from £576 to £819. The biggest change is eVED, the new 3p-a-mile charge from April 2028, which costs that driver £222 a year. Drivers without a driveway come out £145 a year better off in 2027-28, when the new local charging fund cuts their bills, then £82 a year worse off once eVED starts.
By the EV Cable Hub Research Team. Data: EV Cable Hub charging price tracker, home tariff tracker and a survey of 1,214 EV and plug-in hybrid drivers. Last updated November 2026. How we worked this out
Key findings
- eVED costs £222 a year (£18.50 a month) at 7,400 miles for a pure EV and £111 for a plug-in hybrid. At 10,000 miles it is £300; at 20,000 miles, £600.
- A driveway EV driver pays £576 a year to run the car in 2026-27 and £819 in 2028-29.
- An on-street driver is £145 a year better off in 2027-28 thanks to the £100m local charging fund, then £82 worse off in 2028-29. Below 5,000 miles a year, they come out level or ahead.
- A 45 mpg petrol car pays 5.35p a mile in fuel duty against eVED's 3p: £396 a year against £222.
- 20% VAT on public charging is confirmed: 13p of every 78p paid at a rapid charger.
- The business mileage rate above 10,000 miles rises from 25p to 35p, worth £1,000 a year at 20,000 business miles.
- 71% of drivers knew eVED had been announced, but only 38% could name the 3p rate and 22% knew it starts in April 2028.
| Measure | Start date | Who it affects | Effect at 7,400 miles a year |
|---|---|---|---|
| eVED: 3p a mile for EVs, 1.5p for plug-in hybrids | April 2028 | Every EV and PHEV keeper | +£222 a year (EV); +£111 (PHEV) |
| eVED collection: estimation tool, opt-in eVED Connect, automated rebates | April 2028; rebates by 2030 | Every EV and PHEV keeper | Decides how and when the £222 is paid |
| £100m to cut local public charging costs | Spring 2027 | On-street charging users | About -£150 a year |
| 20% VAT on public and workplace charging confirmed | 1 November 2026 | Public charging users | No price change; 13p of a 78p rapid kWh is VAT |
| Household electricity VAT cut extended | To July 2027 | Home chargers | Blended rate stays 11.1p; +£12 a year after |
| 5p fuel duty cut extended | To July 2027 | Petrol, diesel and PHEV drivers | Worth £44.85 a year to a 45 mpg petrol car |
| Business mileage: 55p permanent; 35p above 10,000 miles | 35p modelled from 6 April 2027 | Drivers using their own car for work | +£500 at 15,000 business miles; +£1,000 at 20,000 |
| Company car tax up 1 point in 2030-31 (EVs 9% to 10%) | 6 April 2030 | Company car drivers | +£160 a year (£40,000 EV, higher rate) |
| VED rises by RPI | 1 April 2027 | Every keeper paying VED | Standard rate £200 to £205 (modelled) |
| Budget of 28 October 2026. Effects are EV Cable Hub modelling for a driver covering 7,400 miles a year. | |||
What the Budget costs five types of driver
A driveway EV driver at the average 7,400 miles pays £243 a year more by 2028-29 than in 2026-27. Almost all of that is eVED. The rest comes from the end of the household electricity VAT cut in July 2027 and the RPI rise in VED.
On-street drivers have a better 2027-28, because the £100m local charging fund takes about £150 a year off their public charging bill from spring 2027. eVED then outweighs it. Company car drivers face the steepest climb, but that is mostly rises already set before the Budget; the Budget's own one-point increase adds £160 in 2030-31.
| Driver type | Miles a year | 2026-27 | 2027-28 | 2028-29 | Change by 2028-29 |
|---|---|---|---|---|---|
| Driveway EV driver | 7,400 | £576 | £588 | £819 | +£243 |
| On-street EV driver | 7,400 | £1,494 | £1,349 | £1,576 | +£82 |
| High-mileage business driver (own EV) | 20,000 | -£4,387 | -£4,869 | -£4,258 | +£129 |
| Company car driver (£40,000 EV) | 10,000 | £640 | £800 | £1,120 | +£480 |
| Plug-in hybrid owner | 7,400 | £1,159 | £1,187 | £1,315 | +£156 |
| Petrol car (comparison) | 7,400 | £1,481 | £1,516 | £1,536 | +£55 |
| Negative figures for the business driver mean the mileage allowance exceeds running costs. | |||||
eVED: 3p a mile from April 2028
eVED charges 3p a mile for battery electric cars and 1.5p a mile for plug-in hybrids from April 2028, 17 months after the Budget. At 7,400 miles that is £222 a year for an EV. It sits on top of VED rather than replacing it, so an average EV under the expensive car supplement threshold pays about £210 in VED plus £222 in eVED in 2028-29.
Drivers will estimate their mileage in advance with an official tool, or opt in to eVED Connect to pay on actual miles. Overpayments will be refunded automatically by 2030. Our eVED calculator works out your own bill.
Annual eVED bill for a pure EV
Drivers expect to pay more than they will. Asked to guess their first bill, drivers in our survey said £310 on average. At the mileage they actually report, it will be £236, 31% less than they fear. Low-mileage drivers overestimate most: those under 5,000 miles expect £225 and will pay £102.
eVED vs fuel duty: 5.35p a mile for petrol, 3p for an EV
A petrol car at 45 mpg pays 5.35p a mile in fuel duty today, while an EV will pay 3p in eVED from 2028. A petrol car would need to return 80.2 mpg to pay less, and 87.8 mpg once the 5p duty cut ends in July 2027.
Counting VAT changes the picture for drivers who charge in public. A driveway EV pays about 3.16p a mile in tax in 2028-29, against 8.84p for a 45 mpg petrol car. An EV that only uses rapid chargers pays 6.71p, because 20% VAT on public charging adds 3.71p a mile. There is more detail in our comparison of eVED and fuel duty.
| Vehicle and charging | Road-use tax | VAT | Total per mile |
|---|---|---|---|
| EV, home blended tariff | 3p (eVED) | 0.16p | 3.16p |
| EV, public slow/fast AC | 3p | 2.57p | 5.57p |
| EV, public rapid | 3p | 3.71p | 6.71p |
| EV, public ultra-rapid | 3p | 3.90p | 6.90p |
| Petrol, 45 mpg | 5.85p (duty) | 2.99p | 8.84p |
| Diesel, 50 mpg | 5.27p (duty) | 3.15p | 8.42p |
Home and public charging: what changes, and when
The household electricity VAT cut keeps our blended home charging rate at 11.1p per kWh until July 2027. When it ends, the rate rises to 11.65p, which adds about £12 a year for an average driveway driver, or £27 on a standard variable tariff.
Public charging prices do not move: the Budget confirmed in law the 20% VAT that already applies from 1 November 2026. At our Q3 2026 rapid charging average of 78p per kWh, 13p of every kWh is VAT. An on-street driver at 7,400 miles pays £162 a year more than they would at the 5% household rate. Our UK public charging price index tracks those prices quarter by quarter.
The £100m local charging fund vs eVED for on-street drivers
The Budget put £100m over two years into cutting local public charging costs from spring 2027, plus a taskforce to let drivers use their home tariff at on-street chargers. We estimate it is worth about £150 a year to a driver who relies on on-street chargers.
From April 2028, eVED costs that same driver £222 a year at 7,400 miles, which leaves them £82 worse off. The break-even is lower mileage: at 4,000 miles the fund saves £150 and eVED costs £120, so the driver is £20 better off. If you charge on the street, our guide to the driveway divide shows how much more public charging costs.
Business mileage, company cars and plug-in hybrids
The 55p business mileage rate is now permanent, and the rate for business miles above 10,000 rises from 25p to 35p. At 20,000 business miles in your own EV that is £1,000 more a year.
Company car tax for EVs rises one point in 2030-31, from 9% to 10%. A higher-rate taxpayer with a £40,000 EV pays £640 in 2026-27 and £1,600 in 2030-31; the Budget's own rise is £160 of that. Our guide to EV road tax sets out VED and eVED side by side.
A plug-in hybrid driver covering 7,400 miles, 40% of them on electricity, pays £156 a year more by 2028-29: £111 of eVED at 1.5p a mile, with most of the rest from the end of the fuel duty cut.
Seven dates to know
| Date | What changes |
|---|---|
| 1 November 2026 | 20% VAT on public and workplace charging confirmed in law |
| Spring 2027 | £100m local charging fund starts cutting on-street charging costs |
| 1 April 2027 | VED rises by RPI (standard rate modelled at £205) |
| 6 April 2027 | Business mileage above 10,000 miles rises to 35p (modelled) |
| July 2027 | Household electricity VAT cut and 5p fuel duty cut end |
| April 2028 | eVED starts: 3p a mile for EVs, 1.5p for PHEVs |
| 2030-31 | Company car tax for EVs rises from 9% to 10% |
How we worked this out
All figures are for tax years (6 April to 5 April) and use the rates announced in the Autumn Budget on 28 October 2026. Charging costs use EV Cable Hub's Q3 2026 price data: a blended home rate of 11.1p per kWh, 54p at public AC and 78p at rapid chargers, with EVs covering 3.5 miles per kWh. Where the Treasury has not published a rate, such as the exact VED figure after the RPI rise, we model it and say so. The driver survey questioned 1,214 EV and plug-in hybrid drivers in the four days after the Budget.
Budget 2026 and EV drivers: your questions answered
How much will eVED cost me?
£222 a year, or £18.50 a month, if you drive an electric car the UK average of 7,400 miles. eVED charges 3p a mile for EVs and 1.5p for plug-in hybrids from April 2028. At 10,000 miles an EV pays £300 a year.
When does pay-per-mile EV tax start?
April 2028, 17 months after the Budget of 28 October 2026. Drivers can estimate their mileage with an official tool or opt in to eVED Connect, with automated rebates for overpayments by 2030.
Does eVED replace road tax for electric cars?
No. eVED is added on top of VED. An average-mileage EV under the expensive car supplement threshold pays about £432 in 2028-29: roughly £210 in VED plus £222 in eVED.
Will EV drivers pay more tax per mile than petrol drivers?
No. 3p a mile in eVED is less than the 5.35p a mile a 45 mpg petrol car pays in fuel duty. Including VAT, a driveway EV pays about 3.16p a mile in 2028-29 against 8.84p for petrol.
What does the Budget mean for drivers without a driveway?
£145 a year better off in 2027-28 and £82 a year worse off in 2028-29 at 7,400 miles. The local charging fund saves about £150 a year from spring 2027, but eVED adds £222 from April 2028.
What is the new business mileage rate?
55p a mile for the first 10,000 business miles, now permanent, and 35p for each mile above that, up from 25p. At 20,000 business miles a year that is £1,000 more.
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