Fears Rachel Reeves new £300 car tax plan ‘could collect drivers’ data’

Rachel Reeves’ new pay-per-mile car tax plan could soon collect information from inside vehicles, according to the Treasury. Electric cars are set to be slapped with a 3p-per-mile fee from April 2028, with plug-in hybrid owners charged 1.5p per mile. The new fee means that motorists travelling an average of 10,000 miles per year will pay an extra £300 to use the roads.

Officials have now confirmed they are considering using “in-built connectivity” to send information, such as mileage data, over 5G. The new electric Vehicle Excise Duty (eVED) rule will rely on motorists estimating their mileage, with garages then reporting odometer readings at MOT tests.

However, the technology could allow cars to transmit mileage data remotely, which officials said will be “quicker”. But the Treasury has stressed that the use of in-built technology will be optional and not mandatory at this stage.

The Treasury report said: “The government can also confirm that we will begin developing optional additional functionality within eVED, which will allow motorists to choose to make use of their car’s in-built connectivity (i.e. the ability to send/receive information by 4G/5G).

“Making use of mileage data that cars already report will be optional, but those who do opt in will benefit from a quicker, easier-to-use, and more flexible system. The government will continue to work closely with representative bodies, garages, manufacturers, fleet and leasing businesses and other stakeholders as this work progresses and will provide a further update by the end of the year on the plan for this opt-in eVED functionality.”

However, Steve Walker, head of digital content at Auto Express stressed that officials still needed to answer “big questions” around a range of issues, including data collection.

He said: “It risks breeding yet more uncertainty in an already confusing marketplace, with big questions around the implementation of the tax, collection of mileage data, how it will be levied on plug-in hybrids and whether foreign registered vehicles will escape the charge completely remaining unanswered.”

The Treasury document outlined that respondents to the consultation did support the use of technology and automation to make the system easier to comply with. However, individuals stressed that this was only providing that the use of technology was “secure, proportionate and addressed privacy concerns”.

The Treasury added: “The consultation welcomed views on how various technologies could be used on an opt-in basis in future to simplify the system and reduce administrative burdens on motorists and businesses.

“Protecting motorists’ privacy as part of eVED is a priority for the government, so the intention is for any potential technology-based solutions considered in future to be optional.”