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Electric motorcycles to pay road tax

Electric motorcycles and scooter owners will have to start paying Vehicle Excise Duty (VED, better known as road tax) from 1st April 2025. It’s part of a wider end to the electric vehicle tax exemption which also sees the end of free road tax for electric cars and vans. Chancellor of the Exchequer Jeremy Hunt said that this was to make the motoring tax system “fairer,” as the Office for Budget Responsibility estimates that by 2025 half of new car sales will be electric. Of course, this comment does not apply to electric two-wheelers, whose market is still at the embryo stage – in January-October 2022, electric scooters/motorcycles made up just 5.5% of new sales.

However, electric motorcycles will only have to pay £22 a year (the current rate for sub-150cc bikes) compared to £101, the current rate for a 600cc+ machine. Until April 2025, the tax rate will remain free.

Electric two-wheelers still enjoy a modest grant towards the new price – now 35% off the retail price up to a cap of £500 for motorcycles/scooters, with a £150 cap for mopeds. The grant doesn’t apply to any new electric bike costing more than £10,000, which apart from the mopeds and A1 class, is currently most of them.

The RAC’s head of policy, Nicholas Lyes, said: “After many years of paying no car tax at all, it’s probably fair the Government gets owners of electric vehicles start contributing to the upkeep of major roads from 2025.”

Jim Freeman, Chair of the BMF, added: “It may be ‘fairer’, but if the government want to increase that 5.5% of new sales, it doesn’t send a very good signal.”

Written by Peter Henshaw

Top image courtesy of Harley Davidson