The Chancellor is said to be considering a pay per mile scheme (Image: Getty)
He warned consumer costs could rocket under the updates as he demanded clarity from the Government on any updates.
He said: “Over the coming months and years, people will be making car-buying decisions that will be affected when whichever new tax or taxes are introduced to plug the gap lost from Fuel Duty, Vehicle Excise Duty and VAT.
“I’d now like to ask the Government to outline what approach it will be taking with regards to electric vehicle taxation given how quickly EV ownership has progressed in the last few years, and how quickly it will continue to evolve.
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Bath’s new Clean Air Zone is set to be the first outside of London when it launches next Monday.
Private cars and motorbikes will not be charged under their scheme with the council focusing on other types of vehicles.
Taxis and private hire vehicles will be charged £9 per day to use the roads alongside vans, light goods vehicles and minibuses.
Heavy Goods Vehicles, trucks, lorries and coaches will all be charged £100 to use the roads when the new scheme is launched.
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Fiona Howarth said it was too early to see the effects other schemes would have on electric car rates at this stage.
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“Whereas they get a lot of gain from doing incentives and that s actually what we’re seeing more of in terms of consultations.”
The Department for Transport (DfT) said the Government was committed to achieving net-zero emissions by 2050 and the transition to electric vehicles.
However, they confirmed revenue from motoring taxes must “keep pace” with any changes on the road.
They confirmed any changes to car tax rates would be considered by the Chancellor and announced in due course.
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Ms Howarth added she “can’t say” electric cars would never be taxed but said the Government’s commitment to electric cars would be a barrier to extra costs.
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“But I think the one percent is so low it s relatively negligible. For a Model 3, one percent will be £14 per month, the equivalent on a BMW 3 Series is now £344 per month.
“So £14 per month is so much less. And switching from petrol and diesel to electricity, there saving about 90 percent on their fuel costs if they can charge from home.
And so actually the saving they are making between petrol and diesel and electricity will more than offset that change as well.
“It’s still so low so I m not worried about it from that perspective.”
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Last year, Octopus Electric Vehicles claimed the number of drivers leasing electric vehicles had soared since new tax rules were introduced.
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Petrol prices have jumped from around 1123p per litre in August to over 122p per litre in just six months.
Diesel charges are also up eight pence from around 118p in the summer to now around 126p per litre.
The current charges are at the same level as a week before the first lockdown despite the country still shut up and traffic volumes down.
However, Mr Madderson warned drivers should not see petrol stations as simply “cash cows” for their money.
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He said many retailers had been “burdened” with “excessive taxation” which has driven up costs for drivers.