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Drivers operating EVs might face a new tax in this month's financial announcement.

Amid mounting demand on the finance minister to find billions of dollars in additional income, discussions have reportedly taken place within official departments regarding the possibility of introducing a new charge on EVs.

"Fuel duty applies to gasoline and diesel, but there's no similar tax for EVs. We aim for a fairer arrangement for all drivers," stated a government spokesperson.

This statement follow articles that the Budget would contain a fresh pay-per-mile fee for EV owners.

Proposed Pay-Per-Mile Charges

According to reports, electric vehicle owners might be billed three pence per kilometer, in addition to other vehicle duties, amounting to an additional twelve pounds on a trip from London to Scotland's capital. Drivers of hybrid cars would likewise be charged, but at a lower rate.

The plan suggests that drivers would have to estimate and pay for their mileage for the upcoming year. Should they drive fewer miles than projected, they would get a credit to transfer to the following year, but if they travel additional distance, they would face a top-up fee.

Context and Government Income Shortfall

Motorists of petrol and diesel vehicles pay petrol tax, so the transition to EVs creates a gap in public finances, which are already under significant pressure.

Starting from April of the current year, electric cars are no longer free from vehicle excise duty, due to a change made in the previous financial plan.

"Our goal is a fairer system for all drivers whilst supporting the transition to electric vehicles," added a government representative.

"It is right to seek a taxation framework that equitably funds roads, infrastructure and public services," they added.

Assistance for Electric Vehicle Adoption

Nonetheless, the government stated they were still support the move away from gasoline and diesel, highlighting £4bn in support already provided, including grants to reduce upfront costs by up to three thousand seven hundred fifty pounds per eligible vehicle.

"We plan to look at further assistance programs to make purchasing EVs more convenient and more affordable," they affirmed.

Opposition and Concerns

Opposition finance spokesperson the Conservative MP disagreed with the proposal to tax electric vehicle owners and said at this time was not the time for "a further tax raid".

"It would be inappropriate for the chancellor to target daily drivers and vehicle owners in this way just to help fill a black hole she has created in the government budget," the opposition politician said.

There has been increasing worries about the developing "revenue shortfall" from more gasoline and diesel cars being removed from the roads.

That has put mileage-based systems in the spotlight, but there has been push back from some quarters.

Sector Reaction

The AA president, AA president, said that while the authorities was losing petrol tax income, it should "proceed with caution unless their actions hinder the transition to electric vehicles".

He added that vehicle purchases suggested that the government's set zero emissions goal would not be achieved this year, and the detail of the proposal was required "to ascertain whether these fresh levies will be equitable or a poll tax on wheels".