Spending review a chance to ‘double down’ on EVs
The SMMT has urged the government to ‘double down’ on the EV transition by introducing new fiscal measures in this week’s spending review.
It said that halving VAT on new purchases would help put two million EVs on the road by 2030 and cut CO₂ emissions by six million tonnes per year.
Meanwhile, removing EVs from the VED supplement and equalising VAT on public charging with home rates would underscore the government’s commitment to electrification.
Its own figures revealed a rise in EV sales in May, but the EV market share of 20.9% remains well short of the 28% target stipulated by the ZEV Mandate.
Bolder ambition
The SMMT said: “Bolder ambition is needed to drive the economic growth and decarbonisation the country needs. The Comprehensive Spending Review is the right moment to double down on the commitment to net zero by backing the EV transition with fiscal measures that boost the market and shore up our competitiveness.
“Halving VAT on new purchases would help put two million EVs on the road by 2030 and cut CO₂ emissions by six million tonnes per year.
“Removing EVs from the VED supplement, meanwhile, and equalising VAT on public charging with home rates would send a clear and decisive signal – 2025 is the time to switch.”
LCVs
The SMMT has also called on targeted support for the light commercial vehicle sector, which shrank for the sixth month in a row in May due partly to new fiscal measures taxing double-cab pick-ups as cars.
It said: “Electric van uptake is growing, but remains just over half of the 16% market share mandated for 2025. Government support through the Plug-in Van Grant is vital but further green growth hinges on faster investment in LCV-suitable charging infrastructure – at depots, shared hubs and public locations.
“Preferential treatment for depot grid connections and efficient planning policy implementation are essential.”
