The 2025 Autumn Budget marks a significant shift to UK motoring policy. With the introduction of a new mileage-based tax for EVs, a substantial amount of new funding for charging infrastructure, and changes to the Motability Scheme, the government has laid out a long-term roadmap for electric cars and plug-in vehicles.
Below, we’ll outline the most important points in the 2025 Autumn Budget for fleet managers and employees to help you navigate the changes you’re likely to see in the automotive industry over the coming months and years.
EV Mileage Tax (eVED)
- Mileage tax for EVs and hybrid cars – on average £20 per month.
One of the most important points outlined in the Autumn Budget is EV Mileage Tax or eVED. From 2028, EV drivers, including business fleets, will be required to pay a mileage-based tax per mile – (Gov.uk).
This policy comes into place to ensure all vehicles on the road pay tax. But what does this mean for businesses?
EV Fleet managers will be required to pay half the fuel duty-equivalent rate, with plug-in hybrids benefiting from a reduced rate. While this means businesses will have to pay more towards their fleet each month, it’s minimal compared to petrol and diesel car tax, so it is still beneficial to make the switch.
The average EV driver is likely to pay around £20 towards EV tax, or approximately £240 a year. If your business fleet is made up of electric vans – good news! EV mileage tax doesn’t include vans, HGVs or motorcycles initially.
Electric Vehicle Support
- An additional £1.3 billion in funding for the EV grant
- ECOS changes delayed until 2032
- Public charging costs to be reviewed in 2026
The Autumn Budget includes policies encouraging the uptake of electric cars, including:
Electric Car Grant
The government has promised an additional £1.3 billion in funding towards the Electric Car Grant, extended to 2029-30 – (Gov.uk). This grant is already being utilised by 35,000+ drivers, and is worth up to £3,750 per eligible EV.
The grant will be deducted from the overall price of your chosen EV, so you can benefit without having to do anything. Whether you’re choosing an EV as a personal vehicle or for your business fleet, the EV grant allows you to save on eligible vehicles under £37,000.
Benefit-in-Kind Delay for Employee Car Ownership Schemes
A fleet taxation shakeup was announced in 2024, to ensure that any loopholes around paying tax on Employee Car Ownership Schemes were closed and Benefit-in-Kind vehicles were being taxed appropriately. The removal of ECO Schemes as a tax-efficient option for businesses meant higher tax bills, an impact on employees’ take-home pay, as well as rising fleet costs.
However, this policy has been delayed from 2026 to 2030, with a 2-year transitional period. This is good news for employees and employers alike, with more time to weigh up options, reduce admin burden, and prepare for change.
Public charging
The government has outlined support for public charging. This includes a review of current charging costs, for example, in car parks, office buildings and supermarkets, to determine how they can be reduced. This will run from Q1 to Q3 in 2026 and aims to improve the uptake of EV driving.
EV Charging Infrastructure
- Pavement charging consultation for homes without driveways
- An additional £100m funding for public chargers
- £100m to train local authorities
- 100% business rate relief for eligible EV forecourts and chargers – (Gov.uk)
As an EV driver, knowing where you can charge on your journey is essential. The UK Government’s budget has revealed policies that will improve charging infrastructure around the UK. Some of these include:
Funding for charging points
The government has pledged an additional £100m on top of the £400m they’ve already committed to EV charging infrastructure. This funding supports the implementation of home, workplace, and public charging points, enhancing public availability, and most importantly, giving EV drivers peace of mind that they won’t be without a charger on longer journeys, reducing range anxiety.
In addition, £100 million will be spent training and staffing local authorities to ensure charging points are rolled out successfully, accelerating local charging implementation.
Motability
- The Motability Scheme will no longer include some luxury manufacturers – (Motability Scheme UK).
The Autumn budget outlines changes to the Motability scheme. The government has tightened the eligibility criteria for vehicles included in the scheme, meaning some luxury vehicles, including Mercedes-Benz and BMW, will no longer be available. This is an effort to bring the focus back to practical and affordable vehicles and make a shift towards British-built cars.
If you already have one of these cars through the Motability Scheme, you don’t have to do anything – these changes won’t come into place until your contract comes to an end.
The Autumn Budget 2025: Summary
The Government’s budget features policies that will have an impact on EV fleets, taxation for businesses, and personal electric car use, so what are the most important points you need to consider?
- Introduction of eVED: means higher costs for EV fleets and salary-sacrifice drivers, but costs are still lower than for ICE cars. Total Cost of Ownership will need to be updated due to new tax implications. Mileage-heavy fleets may need to consider their options.
- EV car grant expansion: Automatically reduces the cost of EVs and improves leasing rates on eligible models. This supports continued EV adoption in salary sacrifice schemes and business fleets.
- Delay to ECOS changes: Fleets have an additional 4 years before new BIK changes apply, giving businesses the chance to consider next steps.
- EV charging infrastructure boost: Funding towards charging infrastructure, with consultations surrounding the cost to charge in public, reduces range anxiety for fleet managers and employees. This also means easier access to public charging and charger installation at workplaces.
- Business rates relief for EV chargepoints: 100% relief in 10 years, which reduces overheads for businesses considering installing their own charging networks.
So, what can businesses and fleet managers take away from the Autumn Budget 2025? Generally, more incentives and funding keep EVs attractive for fleets despite new taxes. Grants improve EV and infrastructure affordability, and extra funding for roads and charging should cut downtime, damage and range anxiety for high-mileage fleets.
EVs are still a great choice when it comes to fleet vehicles, but with the Autumn Budget announcement, there are a few factors fleet managers will have to consider: Fleets should refresh TCO models and prioritise sub-£50k EVs.
For advice on electrifying your fleet or to find out more about electric car leasing, business leasing or personal lease options, get in touch with our expert advisors who’d be more than happy to help.