Overview
- The government confirmed the policy on Monday, July 13, publishing draft legislation and setting rates of 3p per mile for full electric cars and 1.5p per mile for plug‑in hybrids, with the charge to take effect in April 2028.
- Under the planned system motorists will pay an upfront fee based on estimated annual mileage, with options to spread payments monthly and a year‑end reconciliation using submitted odometer readings paired with MOT or registration‑anniversary checks.
- The Department for Transport says DVLA legacy systems will not support automatic refunds at launch so refunds will be limited to specific cases while officials build new payment, verification and DVLA systems.
- Industry groups and driver bodies warn the scheme is complex and could leave drivers and fleets out of pocket; a reported internal assessment says about 5.6 million vehicles could be affected and the impact may be material for some firms.
- Next steps set out by ministers include a technical consultation on draft legislation, new guidance for motorists and MOT garages, simplified bulk and payment arrangements for fleets and a further government update before the end of the year.