Chancellor Ushers In New Era of Car Tax with Pay-Per-Mile Pricing Beginning With Electric Vehicles

Chancellor set to unveil ‘VED+’ scheme targeting electric vehicle owners in November 26 Budget

Rachel Reeves is about to usher in a new form of car tax: pay-per-mile whilst officially still denying that she is.   

On November 5th 2025, the Daily Telegraph revealed Treasury plans for an entirely new form of car tax that of pay-per-mile charging, the first time the scheme will be operated in the UK.

Initially the tax will only apply to electric vehicles, but Vision News has evidence that this is merely the start and that pay per mile will ultimately replace the current scheme.

The first phase is set to be announced in the Autumn Budget on November 26th.  Dubbed ‘VED+’, drivers will initially be asked to estimate their annual mileage and pay 3p per mile  on top of standard Vehicle road tax as Reeves removes the current exemptions for EVs.

After the initial self-assessment phase the government will likely deploy AI tracking.   Older cars will then be tracked via numberplate recognition cameras whilst newer cars will be tracked via a black box which ALL new cars have been fitted with since 2024.   

Rachel Reeves has previously denied that road pricing was coming telling MPs in November 2024: “We are not looking at road pricing.”

The Government sold the public the tax-free motoring forever lie and thousands of people fell for it.  Now, not will electric vehicles have to pay-per-mile to go anywhere they will also have to pay road tax of £640 per annum.

Pay-per-mile figures:

•  3p per mile = £250-£300 extra per year for average 10,000-mile driver

•  £20-30 billion – projected Treasury black hole from lost fuel duty by end of Parliament

•  £1.8 billion – expected revenue from the scheme by 2031

•  6 million – EVs on UK roads by 2028 launch

•  £12 – extra for single London-to-Edinburgh trip

•  EVs already pay £190 standard VED from April 2025, plus £410 Expensive Car Supplement if over £40k

Shadow Chancellor Sir Mel Stride: “If you own it, Labour will tax it. It would be wrong for Rachel Reeves to target commuters and car owners just to fill a black hole she created.”

AA president Edmund King: “This could be viewed as a ‘poll tax on wheels’ – the Government has to tread carefully or slow the transition to EVs.”

Electric Vehicles UK chief Tanya Sinclair: “The system needs reform – but carefully, transparently, and with consultation. That will take years, not months.”

Debunking the spin:

Treasury says “fairer than fuel duty” – yet petrol drivers average £600/year in duty while EV owners already lost VED exemption in April 2025.

They claim “no mass surveillance” – but are installing massive amounts of cameras, geo-fencing and investing millions in artificial intelligence for SMART cities.

Your old petrol car is looking more and more like the smarter option with every passing day.

By 2028 your “cheap” electric car becomes a rolling tax bill. The 'green dream' just got priced per mile – and rural drivers, commuters, and families pay the heaviest price.