Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential impact of the EV mileage charge on the (a) rental and (b) leasing motor vehicle sector, including the implications for (i) fleet turnover and (ii) the supply of nearly-new EVs to the second-hand market.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
As announced at Budget 2025, the Government is introducing Electric Vehicle Excise Duty (eVED) from April 2028, a new mileage charge for electric and plug-in hybrid cars, recognising that EVs contribute to congestion and wear and tear on the roads but pay no equivalent to fuel duty.
The Government has set out the expected impacts, including Exchequer impacts and behavioural changes, from eVED and other Budget measures in the Budget 2025 Policy Costings document at GOV.UK, which can be found here: https://www.gov.uk/government/publications/supporting-documents-for-budget-2025
The rate of eVED paid by electric vehicle drivers will be half the fuel duty rate paid by the average petrol/diesel driver, ensuring that it will still be cheaper to own and run an EV for the majority of EV drivers. The Government is also providing generous additional support to incentivise the use of EVs.
The Government will continue to engage with impacted sectors and welcomes views on the design and implementation of eVED through the associated consultation.
Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential impact of the proposed EV mileage charge on (a) electric vehicle residual values and (b) the cost of new electric vehicle finance agreements.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
As announced at Budget 2025, the Government is introducing Electric Vehicle Excise Duty (eVED) from April 2028, a new mileage charge for electric and plug-in hybrid cars, recognising that EVs contribute to congestion and wear and tear on the roads but pay no equivalent to fuel duty.
The Government has set out the expected impacts, including Exchequer impacts and behavioural changes, from eVED and other Budget measures in the Budget 2025 Policy Costings document at GOV.UK, which can be found here: https://www.gov.uk/government/publications/supporting-documents-for-budget-2025
The rate of eVED paid by electric vehicle drivers will be half the fuel duty rate paid by the average petrol/diesel driver, ensuring that it will still be cheaper to own and run an EV for the majority of EV drivers. The Government is also providing generous additional support to incentivise the use of EVs.
The Government will continue to engage with impacted sectors and welcomes views on the design and implementation of eVED through the associated consultation.
Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what behavioural changes have been assumed in modelling revenue projections for the proposed EV mileage charge scheme.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
As announced at Budget 2025, the Government is introducing Electric Vehicle Excise Duty (eVED) from April 2028, a new mileage charge for electric and plug-in hybrid cars, recognising that EVs contribute to congestion and wear and tear on the roads but pay no equivalent to fuel duty.
The Government has set out the expected impacts, including Exchequer impacts and behavioural changes, from eVED and other Budget measures in the Budget 2025 Policy Costings document at GOV.UK, which can be found here: https://www.gov.uk/government/publications/supporting-documents-for-budget-2025
The rate of eVED paid by electric vehicle drivers will be half the fuel duty rate paid by the average petrol/diesel driver, ensuring that it will still be cheaper to own and run an EV for the majority of EV drivers. The Government is also providing generous additional support to incentivise the use of EVs.
The Government will continue to engage with impacted sectors and welcomes views on the design and implementation of eVED through the associated consultation.
Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of the Cycle to Work tax exemption initiative on the economy.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The Cycle to Work Scheme is made available as a Benefit in Kind and uses the tax exemption for the employer-provision of cycles and associated safety equipment. The scheme was introduced in 1999 to to encourage employees to commute by bicycle by offering a tax-efficient route to access relevant equipment.
HM Revenue & Customs (HMRC) commissioned independent research to evaluate the effectiveness of the Cycle to Work Scheme, alongside carrying out economic research on the bicycle market’s implications for the scheme’s success. The evaluation and the economic research were published in April 2025.
Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if she will make an assessment of the potential merits of extending the inheritance tax exemption for payments made by infected blood compensation schemes to cover payments received by the surviving spouse of a deceased recipient.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The suffering endured by all those impacted by infected blood is profound, and we remain committed to ensuring that justice is not only delivered but reflected in the way compensation is treated.
We recognise that this is a sensitive issue. We are considering whether further steps are needed in relation to IHT relief. However, it is important that we take the time to consider all aspects thoroughly to ensure any solution is both fair and effective.
Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether she has considered increasing alcohol duty; and if she will make an assessment of the potential impact of doing so on (a) the hospitality sector and (b) levels of excessive drinking.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
On the Government’s consideration of alcohol duty rates, I refer the hon member to the answer that I gave to PQ UIN 78321.
Following the Budget decision, the Government will publish a tax information and impact note (TIIN) to give account of the policy’s impacts.
Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether she plans to introduce environmental (a) taxes and (b) fines to reinvest in (i) green infrastructure and (ii) low carbon innovation.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The government has in place ambitious environmental taxes as part of its commitment to make polluters pay for their emissions and support investment into decarbonisation. The UK’s leading carbon pricing policy is the UK Emissions Trading Scheme (ETS). The ETS covers major emitting sectors - energy intensive industries, power generation and aviation - and requires allowances to be purchased for carbon emissions.
The government recognises the important role that environmental taxes play in incentivising businesses to operate in a more environmentally friendly way. All this revenue is paid into the Consolidated Fund to help to finance vital public services including supporting green infrastructure and low carbon innovation.
Asked by: Scott Arthur (Labour - Edinburgh South West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether she plans to link alcohol duty increases to inflation.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The baseline assumption, shared by the Government and the Office for Budget Responsibility, is that alcohol duty will be increased annually in line with the Retail Price Index, so that it does not fall in real terms.
As with all taxes, the Government welcomes representations from stakeholders to inform policy development.
The Chancellor makes decisions on tax policy at fiscal events, and her fiscal rules require day-to-day spending to be fully paid for through tax receipts.