Pay-per-mile tax could force drivers off the road

A new survey has revealed that many UK drivers have cut their mileage or considered selling their cars to cut costs – and a pay-per-mile tax could accelerate the trend.

Labour is considering announcing a new pay-per-mile tax in its next Budget, due on 30 October,

According to car finance company Carmoola, 20% of UK drivers have considered selling their vehicles dur to running costs, which equates to eight million cars, while nearly a third (29%) have reduced their driving miles this year.

Aidan Rushby, founder and CEO, said: “In one of our recent surveys exploring how drivers have been affected by rising running costs, we discovered that the cost of living crisis is having a significant impact on UK drivers, with eight million cars potentially being sold due to escalating running costs.”

Pay-per-mile tax

Rushy continued: “Gen Z and older Millennial drivers have been hardest hit, with almost a third (30%) of 17 to 24-year-olds and a quarter (25%) of 35 to 44-year-olds indicating that they are under financial pressure to sell their cars.

“The news this weekend about the introduction of a pay-per-mile road tax could exacerbate this trend, driving more motorists off the road. It’s clear that Brits are already struggling, and the new initiative, planned to launch in October, will have serious implications, especially for younger drivers and those living in rural areas who rely on their cars for essential activities like work and education.

“With limited public transportation options in these regions, such a tax risks pushing more people to the brink, making it even harder for them to maintain the mobility they need. It’s crucial that any new policy is designed with these challenges in mind to avoid disproportionately impacting those who are most vulnerable.”