UK government to review mileage rates

30 Mar 2026

The government has confirmed it will review approved mileage rates for business users ahead of a future Budget.

The announcement comes after more than a decade without change - despite rising fuel, insurance and maintenance costs leaving many workers covering the gap themselves.

Rachel Reeves, the Chancellor of the Exchequer, highlighted the issue earlier this month, recognising that approved mileage allowance payment rates have not changed since 2011 even as motoring costs have evolved significantly.

The government says the workers-first review will focus on people who rely on their car to do their job, ensuring 'they are not left out of pocket'. As part of this, the government says it will meet with people struggling with increased costs to inform this review as it develops.

In the meantime, the government says wider action is being taken to support people with the cost of living and keep prices down at the pump, including by freezing fuel duty until September.

Dan Tomlinson, Exchequer Secretary to the Treasury, said: 'Millions of working people rely on their car to do their job. But mileage rates have been unchanged since 2011 and that's increased the cost of working. A review is well overdue.

'Keeping prices down at the pump is an important way we can help people with the cost of living which is why fuel duty is already frozen.'