The Government is bringing forward by a year a tax exemption for electric taxis.
The move will now come into force in April, worth an estimated £1,550 for zero-emission taxis worth more than £40,000.
Chancellor Philip Hammond said: “We’re backing Britain’s black cab drivers to go green.
“This is a victory for the environment and new technologies, which I am determined to support as we build an economy fit for the future.
“Ensuring the air in our bustling towns and cities is free from pollution is part of our quest to become the first Government to leave the environment in a better state than we found it.”
Chris Gubbey, chief executive of the London Electric Vehicle Company (LEVC), said: “We are delighted that the Treasury has brought forward previously announced changes to Vehicle Excise Duty for green taxis.
“These measures will encourage more cabbies to switch to zero-emissions transport sooner – meaning improved air quality across the UK.
“A small number of drivers who already own the vehicle or are expecting to take delivery in March will still have to pay an additional £310 charge.
“However, LEVC will compensate these drivers to ensure that they are not penalised for being the first to make the transition to a cleaner vehicle.”
The Mayor of London, Sadiq Khan, welcomed the announcement, adding: “These are expensive working vehicles – not luxury
ones – and it’s important we help our world-famous trade become the greenest by giving drivers the financial support they need to switch to cleaner models.
“We’re aiming to have 9,000 electric taxis in London by 2020 as part of my plan to protect Londoners from our toxic air,
building on my strong measures that include the T-Charge, the Ultra-Low Emission Zone and transforming London’s bus fleet.
“However, to truly transform London’s taxi fleet we also need to ensure we have the right rapid-charging infrastructure