The shift towards EVs is putting £28bn ($35bn) of government revenue from fuel duty at risk unless the taxation of motorists is overhauled, the Institute for Fiscal Studies (IFS) has warned. The think tank suggested that a tax per mile rate could be a solution. It said it was “unlikely” to see any change in petrol and diesel taxes until 2025, when there will still be an incentive to buy more efficient cars.
The shift towards EVs is putting £28bn ($35bn) of government revenue from fuel duty at risk unless the taxation of motorists is overhauled, the Institute for Fiscal Studies (IFS) has warned. The think tank suggested that a tax per mile rate could be a solution. Fuel tax revenue worth £1bn could be lost if speculation that Prime Minister Boris Johnson is to cut fuel duty by 2 pence per litre is correct.