Will the proposed New Electric car tax make EVs as expensive to run as petrol and diesel ?

The EV tax will "wipe out" the difference in running costs between petrol and electric cars. 

After the Autumn Statement, EV owners are required to pay Vehicle Excise Tax starting in April 2025.

Research that looked at the cost of fuel and insurance also revealed that a petrol-powered car costs on average £1,824, while an electric vehicle (EV), costs an average £1,296 per year to drive for 12 month.

Both petrol- and electric-powered cars have seen an increase in their costs over the past year. The cost of EVs has risen by £275 over the past year, mainly due to rising energy costs.

Based on driving 7,400 kilometers, the average annual energy bill for an electric vehicle has increased by £259 to £676.

A home charging point is an option for EV owners, but it would be more expensive.

However, the average annual cost to run a petrol-fueled car has increased by £202 over the past year to £1,824.

The price rise of petrol is the main driver behind the slower increase in running costs.

The average annual petrol car fuel cost is now £1,048. This is a £161 increase over the previous year. In October, the average petrol price rose to £1.63 per gallon.

Electric cars are still very popular. October data from Society of Motor Manufacturers and Traders shows that sales of battery electric cars have increased by 23.4 percent annually.

Julie Daniels, Comparethemarket's motor insurance expert, stated: "Despite rising energy costs, motorists who have made the switch from a petrol-powered vehicle to an electric one will be happy to see that it is significantly cheaper to operate than a petrol-powered car.

These drivers not only help the environment but also save money on fuel and insurance.

However, many drivers will not be able to afford the upfront costs of purchasing an electric car or installing a home charger point.

"Recently increased taxes could make it less appealing for some drivers to switch to an electric car.

Both petrol and electric car owners can help reduce the cost of running their vehicle by looking around for car insurance after their current policy expires.

"Our figures show that motorists could save as much as £328 by using Comparethemarket before renewing."

"We also agree that EVs should be paid the lowest VED rates. It's important to reward people who use alternative fuels and make zero emissions.

We don't believe that higher energy costs or taxes will make EV owners pay more. The total cost of owning an EV is much lower than traditional cars. It would be a lot of work to change that.