Drivers across the UK are being advised of several key motoring updates coming into effect this December, following announcements in the Chancellor’s Autumn Budget. These changes could influence driving costs, vehicle ownership, and compliance requirements.
Budget Updates
The Autumn Budget introduced major future changes to vehicle taxation and fuel duty, along with new support for electric vehicles (EVs). While most measures begin in 2028, more details on the proposed pay-per-mile system are expected soon. Under the plan, EV owners would pay 3p per mile, and plug-in hybrid drivers 1.5p per mile.
For now, petrol and diesel prices are expected to remain stable due to the 5p fuel duty freeze, extended until September next year. EV drivers may still benefit long term, with £200 million allocated to improving the charging network and £1.3 billion to expand access to the Electric Car Grant.
Congestion Charge Changes
Electric vehicle owners will soon lose the Cleaner Vehicle Discount for London’s Congestion Charge. From Christmas Day, EVs will no longer be exempt and drivers will need to pay the full charge unless eligible for another discount. Additionally, the daily fee for all vehicles will rise from £15 to £18.
A new discount structure will launch on January 2, 2026. Under the revised system:
Electric cars will receive a 25% discount
Electric vans, HGVs, and quadricycles will receive 50%
Car Finance Compensation
The Financial Conduct Authority (FCA) is extending its consultation period to December 12 as it finalises plans for compensating motor finance customers who faced unfair treatment between 2007 and 2024. The total compensation is estimated at £8.2 billion, with affected customers possibly receiving around £700 per agreement. Payments could begin within the coming months, with further updates expected soon.
HMRC Advisory Fuel Rates
From December 1, new advisory fuel rates will apply for employees using company cars. These rates determine how mileage is reimbursed or repaid. For electric company car drivers charging at home, the rate will drop from 8p to 7p per mile.
For motoring spares and accessories this festive season, speak to the experts at Bowers Automates on 01782 590 702 or email enquiries@bowersautoparts.net.