There is nothing you can do about it, electric vehicle taxes are coming
As the government in Switzerland looks into a distance-based electric vehicle tax, what version might we see in the UK soon?
Over the last few months we have become more aware of the additional government taxes on fuel than we perhaps ever have been.
Between fuel duty and VAT, the price of fuel at the pump is raised significantly higher than the value of the fuel itself.
Of course, the time of fossil fuels is coming to an end, and theoretically that means an end to the government taxes on the fuels which power our motorcycles and cars.
Strictly speaking, this is likely to be untrue for most people. Assuming that post-fossil fuels most people switch to electric vehicles, the tax paid on energy bills (around 15%) would essentially be the new ‘fuel duty’, if you like. In that case, a scenario where the government would also introduce increased energy bill taxes is not unimaginable.
In Switzerland, though, they are taking a more direct route. The Swiss government is set to begin taxing electric vehicles, according to Le Repaire des Motards.
The Swiss government are considering a ‘mileage index’, which would mean that you would be taxed more for driving further. Presumably the same system would be implemented for motorcycles.
Le Repaire des Motards says that the revenue the Swiss government currently makes from its own fuel taxes is around two billion euros. In comparison, the UK government, according to LBC, was making around £28 billion from fuel duty in 2019-20. Now we are in the post-Covid reality, the UK Office for Budget Responsibility estimates there will be £26.2 billion raised by fuel duty in 2022-23.
When people stop riding so many Sinnis GPX 125s, et cetera, and start riding more Maeving RM1s and the like, quite a lot of that £26.2 billion is going to start disappearing.
Naturally, a government could not function with such an income loss. In fairness, the British government is rarely functional in ordinary times, so in that sense a steep increase in taxation for electrics would be understandable.
In March this year it was reported by Rappler that Switzerland is currently different from the rest of Europe in that it is not suffering a cost of living crisis, although it is true that the cost of living in Switzerland is historically high.
Taking a British-centric stance (a rarity, of course, for us), it is impossible to ignore that difference, and how in Britain a government which has allowed people to fall into deep financial hardship could simply anticipate its own monetary struggles and demand more money from those struggling people.
Anyway, stepping away from anticipatory hypotheticals and back to (near) certainties, the British government is, at some point in the relatively near future, going to start taxing electric vehicles. Whether they put an additional tax on home electricity bills along with a tax on electricity from public charging stations, or whether they take something more like the Swiss approach and tax based on distance driven remains to be seen, but without a doubt there will be a tax in some form or another. Because, of course, the government cannot survive without sufficient income to pay for its expenses.
