UK cuts electric car grants for the second time in a year | Electric, Hybrid and Low Emission Vehicles

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The UK government has cut grants for electric vehicles for the second time in a year, angering the car industry and prompting a redesign of the car tax.

The grant available for electric cars will drop from £2,500 to £1,500 – half the amount available to buyers at the start of the year. The top price limit for eligible car models will drop from £35,000 to £32,000, down from £50,000 in March.

In an announcement on Wednesday, the government said the government would also cut the grant on small and large trucks from £6,000 to £5,000 and £3,000 to £2,500 respectively.

Electric cars – which produce zero emissions of carbon dioxide – made up 19% of cars sold in the UK in November, as carmakers introduce a series of new models to the market and demand surges amid skyrocketing fuel prices.

The government is helping with a combination of a stick — including heavy fines for automakers that make lots of polluting cars — and carrots like a car bonus and some tax credits.

However, the growing appetite for electric cars has created a problem for the Treasury, which is concerned about the rising cost of subsidies, many of which have wealthier buyers who can afford a new electric car, as well as the effect. on fuel duty.

Some experts argue that government funding would be better targeted at problems such as the still incomplete charging infrastructure. At the same time, the government has set aside up to £50 billion in implicit subsidies for petrol and diesel consumption by freezing fuel surcharges for a decade.

Greg Archer, director of Transport and Environment UK, a campaign group, said: “I think it is inevitable that grants are phased out, and it is right that it is done. The government cannot continue to fund this transition, but it needs to make sure there are good incentives for all market parts.

“We could do the same by raising taxes on large, high-emissions vehicles.”

The industry argues that the government should not make electric cars more expensive while also trying to encourage more people to buy them.

Paul Wilcox, general manager of British brand Vauxhall, which is owned by multinational group Stellantis, said the government required a “more strategic and long-term approach” and argued that the UK lags behind other European countries that remain highly subsidized procurement.

Mike Howes, chief executive of the Association of Automobile Manufacturers and Traders, said: “The cut in grants for electric vehicles again is a blow to customers looking to make change and could not come at a worse time, with inflation at 10 – rising economic uncertainty throughout the year linked to An epidemic is looming large.

“We need to move the market faster – from one in every hundred electric cars on the road, to one in three in just eight years – which means we have to double the incentives.”

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