Hunt’s ‘Tesla tax’ doesn’t go far enough

There were some very chunky tax rises in the Autumn Statement, most of them using the device of ‘fiscal drag’, whereby tax thresholds are not raised with inflation. But there is one tax where Jeremy Hunt could have gone further. Fans of electric cars may be displeased to learn that they will have to pay vehicle excise duty from 2025 – the ‘Tesla tax’, as it has been dubbed. But given the dire state of the public finances you have to wonder why the Chancellor is waiting three years to extract more money from this source.

A disproportionate number of electric cars sold, after all, are towards the upper end of the market – so charging them road tax could be presented as a tax on the wealthy. Electric vehicles have made a lot less headway in the mass market, thanks in large part to their higher purchase costs as well as to problems recharging them – which is not much fun if you live in one of the eight million or so UK homes which have no adjacent off-street parking.