I’m an EV expert – these electric car tax fees should not be raised

GB News guests debate using electric cars in 2022

Electric vehicle car tax rates should not rise “significantly more” with fees set to increase within years.

Fiona Howarth, CEO of Octopus EV said electric car benefit-in-kind rates should not be increased above the five percent planned before the end of the decade.

Company car tax EV rates currently sit at two percent and will be frozen at this level until 2025.

However, the Government then has plans to increase costs by one percent over the next three years.

This will see salary sacrifice rates sit at three percent by 2025/26, four percent by 2026/27 and then five percent by the end of 2028.

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However, Ms Howarth has urged officials to not increase rates anymore for fears it could deter those from switching.

Speaking exclusively to Express.co.uk, she said: “I think the cars are getting better as well and I think the price point of cars is coming down.

“Five percent is still good. Five percent is still low and salary sacrifice and benefit-in-kind on EVs is still very positive by 2028.

“I think keep it there. I don’t think we should raise it significantly more but I think that’s good.”

Benefit-in-kind is the tax charges motorists will pay to take out a company car through an employer salary sacrifice scheme.

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The rates have tended to be low for electric vehicles in a bid to encourage motorists to make the transition.

EVs were completely exempt from paying fees before 2021 but the total costs have steadily increased.

Fees increased to one percent in April 2021 and then two percent just a year later.

Data for HMRC shows the number of employees paying benefit-kind for cars has stayed the same year-on-year with around 720,000 using the scheme.

This ended years of decline since 2015/16 when around 960,000 individuals were paying the rates.

However, Ms Howarth has revealed more could be done to encourage businesses not involved in salary sacrifice schemes to get involved.

She added: “I think also what’s important is supporting people who don’t necessarily have access to salary sacrifice through work.

“How do we help businesses that might not have yet heard about it for example to find out about it so they can make it available to their employees?

“The rate I don’t think is a problem as such. I think it’s just important to make sure that it’s accessible more broadly.”

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