What the 2028 Mileage-Based EV Charge Really Means for Drivers — And Why EVs Can Still Be Cheaper to Run

The Government’s latest Budget announcement has brought major changes for electric vehicle (EV) drivers. From April 2028, a new mileage-based charge will apply to EVs alongside the existing Vehicle Excise Duty (VED). Unsurprisingly, this has already sparked debate — and given EV critics a fresh talking point.

But the full picture tells a very different story.
Even with the new tax, EVs can still offer significantly lower running costs than petrol or diesel cars.

Below, we break down exactly what’s changing and what it means for current and future EV drivers.

What Was Announced?

A new per-mile charge for EVs from April 2028

From 2028, the Government will introduce a per-mile tax on EVs and plug-in hybrids:

• Battery electric vehicles (BEVs): £0.03 per mile

• Plug-in hybrids (PHEVs): £0.015 per mile

These charges will increase annually in line with CPI.

Based on today’s figures:

The average BEV driver covering 8,500 miles per year would pay an additional £255 annually.

Importantly, this tax is not replacing VED — it’s in addition to it.

Will this make EVs more expensive to run?

Short answer: No — EVs can still be cheaper to run than petrol or diesel cars.

Here’s why.

1. Even with the new tax, the cost is still around half the equivalent fuel duty

For a petrol or diesel driver doing the same 8,500 miles:

• Fuel duty currently accounts for a significant portion of every tank.

• The Budget confirms that from September 2026, the 5p fuel duty cut will be reversed, and fuel duty will return to its previous level — and then rise annually in line with RPI.

So while EV owners will pay a new 3p per mile charge…
petrol and diesel drivers will face increasing fuel costs, driven by higher duty every single year.

In fact, the Government states the £255 annual cost for a typical EV driver is “roughly half” the fuel duty paid by an equivalent petrol or diesel motorist.

So even after 2028:

EV running costs remain lower.

2. Electricity costs remain generally lower per mile than petrol or diesel

Even before adding fuel duty, EVs still enjoy much lower “fuel” costs per mile:

• Off-peak home charging can cost as little as 3–8p per mile.

• Petrol and diesel typically cost 16–22p per mile depending on vehicle efficiency and pump prices.

Add rising fuel duty into the mix, and the gap will widen further.

The new per-mile EV tax doesn’t erase the underlying advantage:
EVs convert energy far more efficiently.

3. Maintenance savings still heavily favour EVs

EVs continue to offer long-term savings such as:

• No oil changes

• Fewer moving parts

• Less brake wear due to regenerative braking

• Longer component life in many cases

These savings can easily total £200–£400 per year, offsetting much of the new mileage tax.

4. Total cost of ownership still leans in favour of EVs

Even with the new tax and with VED applying to EVs:

• Lower running costs

• Lower maintenance

• Lower “fuel” costs

• Rising fuel duty for petrol/diesel drivers

• Growing availability of cheaper used EVs

…all combine to ensure EVs continue to offer a competitive — and often cheaper — annual cost of ownership.

Will this impact EV adoption?

Yes — according to the OBR, the mileage-based tax is expected to reduce EV sales by 440,000 across the forecast period.

This highlights one unintended consequence:
The policy may slow adoption even though EVs can remain the cheaper long-term choice.

The challenge, then, is communicating the full picture to consumers — and countering misleading narratives pushed by anti-EV commentators.

Why EV Bashers Are Wrong About “EVs Becoming More Expensive”

Some critics are already claiming the pay-per-mile system makes EVs “bad value”.

But this argument ignores several key facts:

Petrol/diesel drivers will face rising fuel duty from 2026

The reversal of the 5p cut — followed by annual RPI increases — means petrol and diesel costs will continue to climb.

The EV tax is still half the equivalent fuel duty per mile

This is the Government’s own calculation.

Electricity prices are stabilising

Meanwhile oil prices remain volatile and geopolitically dependent.

EV maintenance remains significantly cheaper

A cost most drivers underestimate.

Put simply:
The new tax doesn’t make EVs “too expensive” — it just slightly narrows an advantage that still remains strongly in favour of EVs.

Final Thoughts: EVs Are Still Cheaper to Run — Even After the New Tax

The 2028 mileage-based charge undoubtedly changes the financial landscape for EV drivers.

But the numbers are clear:

• EV drivers: £255 extra per year at 8,500 miles

• Petrol/diesel drivers: roughly double that in fuel duty alone

• And from 2026, increasing fuel duty will push ICE running costs even higher.

For anyone looking at long-term running costs, day-to-day savings, and future fuel-price trends, EVs remain the more cost-effective choice.

The narrative that EVs are “no longer worth it” simply doesn’t hold up against the data.