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Cut taxes or electric car industry will suffer, ministers warned

Mr Hawes also called for electric vehicles to be exempted from the “expensive car supplement” which will be applied to EVs from 2025. The tax, which costs £390 annually for five years after buying a car valued at £40,000 or more, will apply to around half of all EV models at current prices.

Alex Smith, chief executive of Volkswagen’s UK business, said the retail market was suffering “stagnation” when it came to electric cars.

Company car drivers pay less tax on electric cars when they are received as a perk of the job, paying as little as an 18th of the tax a petrol car driver would pay in so-called benefit in kind tax.

In the UK, easing petrol prices and stubbornly-high electricity prices have narrowed the advantage electric cars have over petrol ones in cost per mile, making their higher initial cost seem less attractive.

In the year to date, sales to private buyers have risen just 0.9pc compared to a 43pc rise for fleets.

Last month car sales to households sustained their sharpest slump in more than a year.

The number of cars sold to families and individuals dropped 8pc in August to 32,071, down from 34,891 the prior year – the biggest drop for 14 months.

This article was originally published by a www.telegraph.co.uk . Read the Original article here. .

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