BREAKING EV NEWS: 2025 UK Budget and EV drivers
Hello and welcome to a special breaking news edition of the kilowatt half hour. We’ve not done one of these before, but of course we’ve had big news concerning electric vehicles in the budget today from the chancellor. Of course, it was all leaked earlier this morning as well. Um, so we just thought we’d bring you a special edition of the program based on that. Yeah. And we know that this is going to be an enormous issue, not just for EV drivers, but for anybody who is thinking about switching to electric. Of course, there’s been all these headlines over the past few weeks about what is the chancellor going to do. Of course, she’s finally come out and said what she’s going to do. So, we’re wondering whether it has uh helped your decision to buy an electric car or it’s put you off. Yeah. As always, let us know what your thoughts are on EVs and the budget in the comments below. If you’ve got any more questions about all of this or you just want to have a rant because I think there might be some rants out there. You can also email us at podcastelectrifying.com. So shall I just go through batch because this is completely unplanned. It’s a bit chaotic and apologies. It’s not the right time of day to be recording a podcast cuz I’m dark and you’re a bit orange. So there you go. I’ve not been on holiday. It’s due to the time of day. Yes. Okay. So listen, the top lines are that overall um we’ve got a paper mile tax coming in for electric and hybrid vehicles. We’ve got 1.3 billion pounds in EV discounts. Of course, that comes with a lot of as we’re going to be discussing. Got200,000, sorry, 200 million pounds going into charging. Um there are um changes to the banding around the luxury car tax, so called luxury car tax. Also some pretty big changes coming through to the Motability scheme. So I think they’re the main top lines for us, aren’t they? Should we take those one by one? Batch, what do you reckon? Yeah, let’s do that. You start. Yeah. Okay. Should I kick should I kick off then with with the biggest and probably well, you know, the most contentious for sure, which is the the payer mile tax changes. Look, I think we’ve all known that this was coming. It’s been honestly this th this budget has been as leaky as the leakiest civ you can imagine because everything’s been leaked, hasn’t it? So, we’ve known this was coming and we we’ve heard today um that you know it is. We were we were told we were told ahead of time that there would be a consultation on the new paper mile EV tax. However, this was presented today as a pretty much a done deal. So, um, the Office for Budget Responsibility estimates the move will bring in 1.1 billion pounds when it’s introduced in April 2028. Um, and what we know so far is it’s going to cost an extra three pounds per mile for EVs, um, one a halfp per mile for plug-in hybrids, which will be payable at the same time as your vehicle excise duty and that will still apply to EVs as well. So, this is a kind of ve plus for EV drivers. Um the government has said that the new charge will only apply to cars. It’s not going to apply to electric vans, lorries, motorcycles, coaches or buses. So thoughts on that batch? Um why don’t you kick off with that and then and then I’ll I’ll have a rant as well. Well, you know, you’re right. I mean, it has been it’s been the leakiest ship really, hasn’t it? And um it’s got a lot of people uh rightly so very hot onto the color for the last few weeks. But effectively this has been a topic which we’ve which the industry has been talking about for years. There’s this this impending uh question of how do you fund uh zero emission cars and you know there needs to be a difference between petrol and EV. It’s been a long time coming, but of course it leaked quite a few weeks ago. And I mean, it was initially muted at 9 p per mile, wasn’t it? Which again, it was quite a a big number. It’s actually cheaper. I think that is classic kind of government spin, isn’t it? Start off with the big figure and then actually release it. When you actually come to release it, it’s a lower figure hopefully in in the in the hope that people are going to be happier about it. I’m not entirely sure even at 3p per mile people are going to be particularly happy about this. I think the big surprise for me actually was that this includes plug-in hybrids. I know it’s cheaper. It’s one and a half p compared to 3p. But uh again, it feels like no matter what you do, whether you go full EV, you do the right, you go the go the go right direction and buy an EV or you start that slow transition, you start with a plug-in hybrid to see whether electric works for you and then with the intention to go into an EV later on, you’re going to be clobbered as well. So it feels like yeah, anybody wants to have some form of electric car are going to be clobbered by the chancellor. I think it’s for me it’s really problematic for a few reasons. I think first of all it’s too soon in the transition. Yeah. You know we’ve got big Z mandate targets to hit um um you know which are set for you know for manufacturers um by 2030 80% of their overall sales will need to be electric although there’s a few mechanisms that help them reduce that slightly in in over the next few years which enable them to count the overall emissions of their fleet in that target. But I think for me it’s it’s what message this gives off. Is the government serious about the EV transition? Because it quite frankly doesn’t seem to be. And I think the challenge for me with pay per mile is you’ve got a lot of people who switch to an EV in good faith. And we’re actually paying a fair bit more in upfront costs. And we have got guides and explainers and videos about this thing called total cost of ownership which the government itself has been very keen to talk up. And that’s of course your overall running costs on an EV are less and that that more than compensates for the fact that you may well have paid more in upfront costs. Now we know we’re getting there a bit more with price parity. Some models of course and you know depending on whether you need bigger batteries still are more expensive, but it is definitely getting there. But you’ve got people who switch when we weren’t there and I think that is incredibly unfair to them who switched in good faith based on these lower running costs. The other thing that I find problematic with this paper mile tax is that it’s hitting those people who can’t charge at home. Now, we know that if you can’t charge at home, it’s already more expensive to run an electric vehicle because you’re not taking advantage of all these brilliant overnight tariffs that those of us who are fortunate enough to have home charging can. So, if you’re not able to take advantage of that, then you’re already paying in some cases more per mile to run an EV than you are a petrol car. And now you’re being clubbed for an extra 3p a mile. So I I’m really conf I’m really angry actually about that and I’m really angry that people who can’t charge at home are not being exempt from this charge. And I think that’s something that we’re going to raise with the government and we will push to make sure that this doesn’t come in to hit those people who are already having to pay more for their energy. If you are one of those people, we’d love to know what you think about this paper mile charge. I think in theory it’s not a a bad idea down the line, but I think it’s too soon. Oh, absolutely. And and but the on the subject of fairer charging between public charging and home charging, whether that is cutting the VAT on public charging or or other other other ways of leveling the playing field. This has been called for for a couple of years now. um particularly so this year you know trade bodies like the society of motor manufacturers and trades the SMT you know manufacturers have have been calling for it and it’s on the face of it it seemed to be a very easy way of helping people be convinced that electric is the right buying is the right choice to go with and the government seems to have been completely they’ve decided to be blinkered on this and put their fingers in in their ears and and and instead they’ve been uh finding ways of pumping up the electric car grant which we’ll come on to in a minute thinking that’s a better way of doing it. I’m with you. I think the better it’s all about messaging all of this and today was a bad day for EV messaging. If there’d been ways of of cutting VAT or leveling the playing field when it comes to ch car charging that would have sent a far stronger message. It would. It would. And I just think there’s two more points on this before I I want you to chat us through um what we know about the um the electric car grant. Um one is that this so the the the Office for Budget Responsibility published all this online a couple of hours while the government did which you know we’ll all have known and seen in the news today. And I was looking through this earlier and on page 75 of the OBR report which shows you just how exciting my life is and the fact that I need to get out more is are some figures that the OBR have done on what the impact of this paper mile is going to have and it is absolutely going to bring in a large amount of money. They you know they’ve got all the estimates around that. They expect it will um raise 1.1 billion in the 2028 to 29 financial year rising to 1.9 billion in 2030 to 2031. However, the caveat there is it says as an overall result of this measure we estimate there will be around 440,000 440,000 fewer electric vehicle car sales across the forecast period in relative to the pre-measures forecast. 130,000 of this will be offset by the expected increase in sales due to other budget measures. And those are things like um the grant that we’re going to come on to and some changes around the luxury car tax. But if you you know you take that off, this is over 300,000 fuel electric car sales will be made. So what’s the government trying to do with this? Is it trying to help us transition to a lowcarbon future? and and does it want car makers to hit those zed mandate targets you know or or is it prepared to chuck all that away in you know which is what it’s looking like in favor of getting some short-term revenue in the bank so I’ve got a big concern about that and the only other thing I’m going to say on this is fuel duty fuel duty frozen for what 10th 11th year in a run the elephant in the room but no government wants to address anyway so they’re taking with one hand and then they’re going to give to us with the other batch aren’t they one break, the other on the accelerator. Yeah. Well, I mean, the government would like to say that they’re putting their foot down harder on the accelerator now because uh again, it was rumored uh the back end of last week that it was rumored that the electric car grant was going to be turbocharged or supercharged or more electrons or whatever similar you want to say. But um so the electric car grant as we all know came in force in July. Uh it was a 650 million pound scheme. is absolutely enormous. I mean, this was, you know, made huge headlines. I remember when we were talking about it, this was this is the policy that’s really going to drive people into EVs. And then, of course, we saw the absolute horror of of how it was rolled out initially just for Citroen, you know, and trying to get any any trying to get the government to actually reveal or confirm what cars were part of the ECG was like getting blood out of a stone, wasn’t it? Um, yeah. And as we and at this current moment in time, only four vehicles get this at the massive the top range 300 uh sorry £3,750 uh saving. Um but uh in in but but the government think this is a great uh policy. So they’ve decided to to chuck another 1.3 billion into the pot to uh to uh keep this scheme going. Now, Junior, I don’t know if if you found this surprising. So, when the government have announces they’ve they’ve added some some details on on how the ECG’s gone so far, and they say 35,000 people have made the switch to EVs, which I don’t think is enough really. If you think about the ZEV mandate targets, um I don’t think 35,000 drivers is enough. But then on the other hand, there’s only around 40 cars that get the ECG, isn’t there? So it’s kind of I don’t know whether that’s a good number or a bad number and I’m not sure. Yeah. Well well the brilliant new automotive who are a think tank who do a lot of um analysis of sales figure and data and they actually um you know we get the the monthly um sales figures. They’re very good at predicting those. They have come out with a piece of work that I was reading earlier this week that says that they don’t think you can really attribute any of that 35,000 to the grant alone. You can’t say that these are people who wouldn’t have switched who are making the switch. So that in itself is is problematic. I think the other thing for me is that I it’s sort of skewing the market in a way. You know, you look at the Ford Puma Jenny, it’s sold out. Okay, that car only went on sale in the spring. You can’t get one now. They’re bringing forward next year’s build allocations. Now, that was the first car to qualify for the full £3,750 grants. It’s an all right car. It’s fairly decent. It’s not the best electric car, but there is no doubt that they experienced a huge sales bump because of the taxpayer. And and so it’s not really helping car buyers, is it? It’s helping car makers. Yeah. Yeah. It’s basically a backhanded grant to car makers who build cars in the UK. That’s fine, but be honest about that. Please don’t try and wrap this up in that you’re helping EV drivers because if you were, you’d have something that was a little more inclusive. You would. Yeah. I mean, so we’ve obviously seen the Nissan Leaf added to that as well in the last week, and I just think I’d like to see some more cars eligible for that full amount and perhaps some other brands as well. It It’s pretty limiting, isn’t it? It is pretty limiting, and and particularly when you are trying to convince people to go electric. Um, and of course from a manufacturer perspective, they’ve got they’ve got to sell a certain number of cars this year. The pool needs to be widened. And it’s and and it’s it’s all very worthy and it’s a great idea. The government have have done the electric car grant. It’s based on how green the factory production is. But let’s face it, when you’re trying to convince lots and lots of people to go electric, you know, people aren’t really worried about how how green the car factory is, are they? Let’s, you know, let’s be honest. The the other thing, the other thing to be fair is it’s not actually based on how green the factory is. It’s based on the manufacturing emissions of the country which the battery is produced in two. Yeah. So that means that so ch so the mini electric for example is built in a factory that runs on completely runs on renewable energy. Yet they’re not eligible for the grants. No. Because it’s built in China. Yeah. Okay. And and it also means that lots of car makers are moving to a European supply chain and they’re sourcing batteries from Poland, which is now the second largest battery manufacturer outside China, but they’re transitioning their grid. So any car makers who are trying to do the right thing and bringing the supply chain to Europe again, they’re not ellegible because the batteries produced in Poland which hasn’t got a green grid. I I there are some weird things with this. I want to move on, but just before I do, so Sam, one of our our news um head head of all our our news stories has been in a briefing with the Treasury um about some of the announcements today. So, one of the questions we’ve had about the paper mile is how is it going to be managed? And obviously, if your car’s over 3 years old, we we’ve been told that that’s going to u be logged when you could take it for anote, but of course, new cars, you don’t need an MOT. Hot off the press, Batch, what do you think of this? The new news is that um the current proposal is that new electric vehicles, which of course don’t have an MOT until they’re three years old, will have to visit an MOT center annually to have their mileage verified. Now, the MOT centers can’t cope with the amount of needed at the moment because we have a shortage of train mechanics in the UK. So, that’s what they’re proposing, guys. our new EVs. We’re going to have to pop down to the MOT center to get your mileage checked once a year. Let us know what you think of that in the comments below. Well, just on that, it it’s not just it’s not just a shortage of of technicians to do. There is still and it sounds unbelievable, but it’s true. There is still a COVID backlog atte every single year to have your mileage verified, it’s going to clog up the system. It really is. Okay, I think we need to move on from that and I’m can’t wait to read what you all think in the comments. So, batch um what should what’s the next one? Should I just do quickly? Vehicle excise duty. Okay, luxury car taxes. it’s been called, which was this um tax that was brought in for luxury vehicles. But because the upfront costs of many EVs are more, particularly if you need a bigger car or you need a car with a bigger battery, you ended up with cars from, you know, VW and Kia that were family cars being pulled into paying this tax because the banding was set at £40,000, then moving the threshold to £50,000. So that means that if you buy a new car that’s priced higher than that, you’ll have to pay £425 a year extra. But I do think that makes a bit more sense. What do you make of that one? Uh the really big surprise today. It was it was nice to have a few surprises in the budget actually. So many leagues. It really as I was sitting at my computer writing the story, I I was like, “Oh gosh, that’s that’s really quite um you know, different actually.” Um it is a very welcome move. like you say, I mean, but it does kind of undermine how ridiculous the past few months have been. You know, number of manufacturers have been tweaking this and tweaking that, introducing lower trim levels to get their cars below that 40,000 threshold. Yeah. Um it’s now much higher and the number of cars that are going to now be eligible because of this have absolutely rocketed. I mean, I was looking at some figures earlier on and uh uh 38% of new EVs um have got RRPs between4,000 and £50,000. So, this really does open up the pool to a far larger um number of cars. And of course it’s it’s you know this is this is one of the moves by the government which will help people um switch to electric because if you’re able to say then they have to pay extra road tax because it’s not their fault that their car is goes over a threshold is it? You know it’s uh very welcome move. Yeah it is. But uh although as the OBR has pointed out um you know any increases that come because of this are being wiped out by paper mile. So yeah, it’s so there is that too. Just quickly want to talk about the 200 million going into charging into um charging infrastructure. Again, really welcome, but I do think that backing all this needs to be a bit more of a plan and support for local councils. So we’ve been running some numbers recently based on government figures and um I’ve discovered that, you know, there’s a real postcode lottery around the country when it comes to local charging. Some councils are just really good at it. I sat on a panel with a brilliant woman who heads up the charging infrastructure rollouts for Coventry and she’s doing a great job. You know, they’ve got 750 charges per 100,000 people in Coventry and yet you’ve got big northern cities like Manchester and Lees and Liverpool and Sheffield and Newcastle. They all sit below 100 charges per 100,000 people. So we know that councils have got more expertise. So I think while that is welcome, we do need a bit more expertise and support for comp for councils to get the right charging in at the right place and also having talking to lots of charging providers. Um you know there’s also a real need I think for you know planning restrictions. You know there’s issues with track planning there’s issues with with grid connections. So I think that’s welcome but we definitely need a bit more support behind the scenes. You know, I was chatting to John Lewis who not the John Lewis the the huge department store. He’s the CEO of a company called Chargy and they’ve done a lot of work with Coventry and he just said you know the funding matters but it doesn’t fix the bottlenecks and you know you’ve got to get um things like planning and grid capacity in there as well. You have and right and what else? Go on. Sorry. Well, just just on that point also, um you know, not only are is it a postcode lottery, but um a lot of local councils um they’ve been given government money to invest in these gully chargers, the the gullies in the pavement to allow people to charge up outside their house in terrorist housing, for example, because they can’t have a home charger. Some councils like Oxfordshire have really jumped on this. They’ve used the government cash. They’re triing it. um whereas other councils have really backed away from it and as we know on street charging for people who don’t have home charges is is a massive problem we’ve got to confront. Yeah, absolutely. So important. Um okay, what else have we quickly got to rattle through? Motability changes. They’re interesting. Yeah, the government’s now deciding what a luxury car brand is. Well, yes. And I mean the the the thing that really made my sort of mouth drop during uh the chancellor’s speech was she actually said, you know, Motability, it’s it’s supposed to be helping people with with with mobility problems. We shouldn’t we shouldn’t be funding MercedesBenz lifestyles. And she actually name checked MercedesBenz, which um I thought was quite a a very old thing to say. Um, I’ve also been hearing from I’ve been talking to premium manufacturers over the past 24 hours and all of this was a massive surprise. They weren’t consulted. They weren’t told ahead that this was going to happen. So, all of a sudden, a lot of these premium brands have uh they’ve realized gosh, you know, we’re not going to be selling uh so many cars over the next well the next few years. Also, interestingly, like you just said, Jenny, the government has decided which brands are premium. So it’s Audi, Mercedes, Alfa Romeo, um, for example, but no Volvo, you know, for example. So it’s, uh, it’s a bit of a very interesting thing that, again, I I just do not understand why they didn’t just put a threshold, a slightly higher threshold maybe for EVs and then a threshold and then people can decide what they want. You know, I can completely get, you know, motability scheme costs taxpayers a lot of money and I think it probably does need some revisions to the scheme, but I just again like you beused. And I think this this probably sums up what I feel about the government’s attitude towards the EV transition and the driver is it’s a bit shambolic if I’m honest. It really is. It’s the the mixed messaging is incredible. There you go. There’s some money and some funding. Oh, but no, no, then we’re going to charge you with that. It just feels like they’re, you know, they’re not planning properly. They’re just making policy up as they go along. They are. And and and why is it wrong that somebody who’s got mobility problems may aspire to wanting a BMW or Mercedes? You know, I don’t think it’s for the government to decide which brands are acceptable for people with mobility problems. I mean, we’re, you know, we’re almost going back to the days of having those tiny little little mobility scooters. You know, those little turquoise little car. Yeah. And you know, we’ve moved a long way from that, but now the government seem to be keen on dictating which car which car brands are acceptable for moability users, which I think is wrong. Yeah, absolutely. And also we got to point out that you know the whole cost of that of those cars aren’t funded. You know that what happens is though if you want to upgrade you pay a top up on top of your basic level. Yeah. So yeah, I you know I agree. I I’d be really interested to know what you think about the all of that. And if you are a Motability user, you’re a user of the scheme, do let us know in the comments below. Should we go and lie down in a darken room? I think so. Today’s been quite a stressful day. I’ve got quite angry. Yes. Okay. Well, I’m sure um there’s some of you getting angry out there. Maybe some of you are happy as well. Let us know. You can email us podcastrifying.com. You can drop a comment in the comments below. We’ll pick them up when we come back with a normal podcast next week. In the meantime, thanks for joining us. Happy budget day.
The Chancellor’s Autumn Budget 2025 is a real mixed bag for EV drivers – giving with one hand, taking with the other. In this episode, Ginny and Batch unpack the biggest announcements and what they mean for your running costs, your next car, and the UK’s switch to electric.
Are EV drivers being unfairly targeted, or is this a sensible way to fund Britain’s roads in an electric future? We look at the winners and losers, how pay-per-mile will be managed – and whether the extra grants and charging investment truly balance things out.
Top headlines from the Budget:
⚡ Pay-per-mile tax is coming for EVs from April 2028 (3p per mile for pure EVs; 1.5p for plug-in hybrids).
⚡ £1.3bn boost to EV discounts via a refreshed plug-in / electric car grant package to keep upfront prices down.
⚡ £200 million for UK charging infrastructure, aiming to speed up rollout and improve access across the country.
⚡ Increased threshold for EVs in the luxury car tax (the Expensive Car Supplement), pulling more mainstream EVs out of the extra charge zone.
💬 Got a question or a take on the Budget? Drop it in the comments — we’ll reply and keep you updated as more detail lands.
#Budget2025 #UKBudget #ElectricCars #EVs #EVCars #ElectricVehicles #PayPerMile #RoadPricing #PlugInCarGrant #EVDiscounts #ChargingInfrastructure #EVCharging #LuxuryCarTax #ExpensiveCarSupplement #Motability #EVDrivers #CarTax #RunningCosts #UKCars #Electrifying #GinnyBuckley #FutureOfDriving #NetZero #CleanTransport
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0:00 – Breaking news: Budget shock for EV drivers
1:15 – EV budget headlines: pay-per-mile tax, grants, VED & Motability
2:00 – Pay-per-mile EV tax explained (rates, start date, who pays)
4:11 – Is it fair? Hybrids included, early adopters & “clobbered” EV owners
5:14 – Too soon in the transition & the home-charging vs public-charging divide
8:26 – OBR numbers: revenue raised vs EV sales lost
10:17 – Fuel duty frozen (again) & mixed government signals
10:35 – Electric Car Grant recap: huge pot, messy rollout
12:28 – Is the ECG actually working? Ford Puma, limited models & “green factory” rules
15:40 – How pay-per-mile will be enforced: annual mileage checks at MOT centres?
17:17 – Luxury car tax/VED threshold raised to £50k – what that changes for EVs
19:23 – £200m for charging, postcode lottery & council bottlenecks
21:38 – Motability scheme shake-up & the ‘Mercedes-Benz lifestyles’ row
23:33 – Shambolic EV messaging?
