EV mileage charge will help close gap in tax revenue

BUDGET 2025: ITS UK’s Max Sugarman welcomes shift to distance-based national road pricing scheme

Intelligent Transport Systems UK (ITS UK) is the industry association for transport technology, representing 200 organisations across the sector – including in road pricing, on-demand buses, smart ticketing, self-driving vehicles and more.

We strongly welcome today’s announcement by the government setting out, for the first time in more than a decade, a shift to a distance-based national road pricing scheme. The EV mileage charge is much needed in order to meet the emerging gap in tax revenue from falling fuel duty receipts, as our vehicle fleet electrifies, and means we can finally move to a fairer, more effective road tax system, that charges based on usage.

The UK transport technology sector offers the proven capabilities and expertise to deliver this new road pricing scheme in a smarter, more effective way than a simple odometer reading. 

The industry has the tools to introduce a road pricing system, utilising digital connectivity and roadside infrastructure, that can give policy-makers greater levers to manage their transport networks, and deliver a more effective system for the Treasury too, covering issues, for example, around foreign vehicles. 

ITS UK looks forward to working with the government, on behalf of the sector, as they consult on these proposals.

We welcome other measures in this Budget too – including the rail fares freeze, the inclusion of funding for projects like the Lower Thames Crossing, TransPennine Route Upgrade and Midlands Rail Hub – all of which will support greater connectivity for communities across the UK.

Max Sugarman is chief executive of Intelligent Transport Systems UK (ITS UK)