Her Majesty’s Treasury is facing a £5 billion "black hole" in tax revenue as drivers switch to electric cars, according to new analysis. Research by the RAC Foundation revealed the Chancellor of the Exchequer, Rishi Sunak, could face losing almost a third of the revenue from fuel duty before the end of the decade.
In 2019, before the coronavirus pandemic struck, the RAC Foundation says the government received £28 billion from fuel duty, with £16.4 billion of that (58.6 percent) derived from the 32.9 million cars on the UK’s roads at the time. However, the transport policy and research organisation thinks an “optimistic” estimate of future electric vehicle (EV) could see that figure fall to £11.4 billion by the middle of 2028.
