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- Omodo & Jaecoo to offer an EV tax rebate on two of its all-electric SUVs
- Chinese company takes initiative after Rachel Reeves’ tax announcement
- Even with the new tax, EVs could still be more economical
One of the most popular electric vehicle (EV) companies in the UK has said it will offer customers a rebate that will mean they won’t be hit by the new 3p-per-mile charge announced in November’s Budget.
Omodo & Jaecoo, a Chinese company that sells more than 3% of all the EVs in the UK, said it would offer customers an ‘EV tax rebate’ on two of its all-electric models, the Omoda E5 and Jaecoo E5, worth about 20,000 miles at 3p an hour.
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Gary Lan, CEO, Omodo & Jaecoo, said that the new tax rebate will cover the first few years of the new tax, which is due to come into effect in 2028, as the company wants to make the transition to electric driving “as smooth as possible”.
Speaking about the Omoda E5 and the Jaecoo E5, Lan reportedly said they “represent the forefront of electric mobility” and that the company remains committed to making clean transportation accessible to drivers in the UK.
Who are Omoda & Jaecoo?
Omoda & Jaecoo are actually two different Chinese EV brands created by Chinese EV giant Chery to sell cars in foreign markets. The two brands target different types of customers. Omoda aims to sell EVs to mainstream consumers, whereas Jaecoo targets more off-road, adventurous drivers.
Omoda has been selling EVs in the UK since August 2024. Jaecoo entered the market slightly later in January 2025. Last August their combined sales passed 25,000. In September alone they sold 10,000 EVs.
Why is Omoda & Jaecoo offering the EV tax rebate?
They are offering the EV tax rebate in response to the announcement in the Budget that an EV tax worth 3p per mile will come into effect from April 2028. The Office of Budget Responsibility (OBR) has estimated that it could cost drivers an additional £255 a year as it will be on top of the existing Vehicle Excise Duty (VED) of £195.
Despite the extra cost, it is possible that even with the 3p-per-mile charge it could still be cheaper to buy an EV than a petrol or diesel car.
Graham Conway, managing director, Select Car Leasing, said that EV drivers covering 7,000 miles a year will pay an extra £210 a year with 3p per mile tax increase, taking the total yearly mileage cost to £660 a year for 7,000 miles.
Conway insists that EV drivers will still save £459 a year compared to those who drive petrol or diesel cars, which makes EVs “the economic choice”.
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