● Chancellor single-handedly failed to offer EV incentives● Fuel duty frozen once more, but it’s not seen as enough
Chris Rosamond Chris_rosamond@autovia.co.uk
THERE’LL be no increases in fuel duty for the next 12 months, after the Budget last week ‘baked in’ the five pence cut that was due to expire this month. However, Chancellor Jeremy Hunt’s statement ignored industry calls to support private electric car sales through cuts in VAT and Vehicle Excise Duty (road tax).
Prior to Budget day, the Society of Manufacturers and Traders (SMMT) set out a three-pronged package of reforms it wanted to hear from the Chancellor. The SMMT called on Hunt to cut VAT on private electric car purchases by half to save the average buyer £4,000, to exempt EVs from the five-year ‘expensive car’ supplement on road tax costing £1,950, and to reduce the 20 per cent VAT on public EV chargepoints to the same five per cent VAT paid on electricity used for charging at home. The Chancellor ignored all three pleas.
SMMT chief executive Mike Hawes summed up industry disappointment: “Government has been keen to assure the UK automotive industry’s competitiveness, with support for EV development and manufacturing – including £2.1billion in autumn’s Advanced Manufacturing Plan – but there is little to help consumer demand. Today’s Budget is, therefore, a missed opportunity to deliver fairer tax for a fair transition,” he said. “Reducing VAT on new EVs, revising vehicle taxation to promote rather than punish going electric, and an end to the VAT ‘pavement penalty’ on public charging would have energised the market.”
Fiat UK managing director Damien Dally was one of several industry executives who were more outspoken: “It’s hugely disappointing that the Chancellor has failed to reinstate financial incentives for electric vehicle buyers in [the] Budget,” he said. “The numbers don’t lie, private sales account for fewer than one in five electric car registrations in 2024 – and the overall market share is way below the 22 per cent set by the Government as part of the ZEV Mandate.
“The demand for electric vehicles is waning and we are sleepwalking into an electric-vehicle crisis,” he said.
Meanwhile, the budget measures on fuel duty also received a muted response.
“It would be crass not to be thankful to Jeremy Hunt and the six previous Tory Chancellors
