New £200 annual road tax charges now apply to electric vehicle (EV) drivers following a Driver and Vehicle Licensing Agency (DVLA) policy update effective from April 2026. Electric cars lose their exemption from Vehicle Excise Duty (VED), requiring owners to pay a standard £200 flat rate each year. Costs may increase based on the vehicle’s original list price and registration date.
VED Payment Details for EV Owners
The RAC explains that all UK EV drivers must now pay VED. The amount depends on the registration year and list price. Most owners face £200 annually starting in 2026.
For pricier models, an additional Expensive Car Supplement applies for five years. This adds £440 from the second year, bringing the total to £640 per year. The supplement targets vehicles with list prices over £40,000, though electric cars registered after November 2025 qualify for a £50,000 threshold exemption. EVs registered before April 2017 incur just £20 annually.
EV Sales Boom Amid Fuel Price Surge
EV demand surges as petrol and diesel prices climb due to Iran’s restrictions on tankers in the Strait of Hormuz. UK forecourt prices for petrol and diesel now average 24p and 47p per litre higher than pre-conflict levels, following the Middle East escalation on February 28, 2026.
Renault reports nearly half of its April sales as EVs, up from one-third a year earlier and one-tenth two years ago. Views of its EV website sections rose 42% since the conflict began, compared to early 2026.
Adam Wood, Renault’s UK managing director, states: “We’re seeing a seismic uptick in demand for electric vehicles in the UK. The short-term situation is really proving a catalyst to increasing the level of demand that was growing for electric vehicles. Customers, understandably, are looking at ways to mitigate the rises in fuel prices and to reduce their exposure to the volatility that we’re seeing in supply and pricing of fuel.”
