2 days ago
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New car tax changes could impact road users (Image: Getty)
Petrol and diesel owners are set to face a “big hit to their wallets” in just months with new car tax changes just around the corner.
The most polluting combustion models will be the worst hit with some motorists facing thousands of pounds of price hikes.
It comes as first-year Vehicle Excise Duty (VED) rates for petrol and diesel models will soar from the Spring in a gentle push to encourage road users to switch to EVs.
Fees are set to double for some emissions categories with some facing a whopping £2,745 increase.
Andy Wood, spokesperson for Tax Natives points out the move is likely to have the largest impact on families and small businesses in a major blow.
First-year VED fees are up for the most pollutiing petrol and diesel cars (Image: Getty)
He said: “If you drive a high-emission vehicle, brace yourself for a big hit to your wallet. Starting in 2028/29, VED rates for vehicles emitting over 76g/km of CO2 will double.
“The worst offenders – cars with emissions over 255g/km – will see their annual tax bill leap from £2,745 to a staggering £5,490.
“This isn’t just a money issue; it’s a clear push from the Government to encourage drivers to switch to greener alternatives.
“For families or small businesses relying on older, high-emission vehicles, this could mean tough decisions ahead.”
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Despite the hefty increases, petrol and diesel owners will revert back to the standard VED charge after just one year on the roads.
This will be set at £195 per year, up £5 from the current £190 per annum rare.
However, electric car owners are given a major boost with first-year VED rates to sit at just £10.
Confirming the new first-year rates, HM Revenue and Customs said they hope the move will "increase the incentives” towards new zero-emission cars at the point of purchase.
They added: “Vehicle Excise Duty first-year rates are paid for the first year of a car’s lifecycle, at the point of registration, and vary based on emissions.
“From 1 April 2025, the Vehicle Excise Duty first-year rates will be changed to widen the difference between zero-emission, hybrid and internal combustion engine cars.”
English (US) ·