Car tax per mile UK — as fuel duty revenues decline with the shift to electric vehicles, distance-based road charging is increasingly discussed as a future replacement for current VED. Here is the current landscape in 2026.
Why Pay-Per-Mile Is Being Considered
Fuel duty currently raises approximately £28 billion per year from drivers. As more electric vehicles replace petrol and diesel cars, this revenue declines — EVs pay zero fuel duty and minimal VED. The government must find alternative revenue to maintain road infrastructure funding. Pay-per-mile road charging is one of the leading options.
The UK's Current Position on Road Pricing
No national pay-per-mile scheme has been introduced in the UK as of 2026. The government has commissioned research into road pricing models, and several local authorities have introduced or are piloting congestion and emissions-based charging (such as the London Congestion Charge and ULEZ). However, a national mileage-based tax system remains under review.
International Comparison: How Other Countries Charge
- Germany: LKW-Maut truck toll on all federal roads since 2005
- Netherlands: Plans for kilometre charge cancelled in 2012 due to privacy concerns
- New Zealand: Road User Charges (RUC) for vehicles over 3.5 tonnes — distance-based
- USA: Per-state mile-based taxes for heavy vehicles, pilots for passenger cars
How a UK Pay-Per-Mile Scheme Might Work
Any UK pay-per-mile scheme would likely use GPS or odometer-based tracking to record distance driven. Black-box insurance policies have already familiarised many UK drivers with telematics technology. Privacy concerns are significant — drivers are wary of government tracking their every journey.
Conclusion
Car tax per mile UK is not yet in place but remains under active consideration. The transition will affect all drivers, especially EV owners. GOV.UK research publications track the latest developments.