Rachel Reeves’ automobile tax raid to see prices enhance for ‘each automobile’ in days | Politics | News | EUROtoday

Rachel Reeves’ newest tax raid will come into impact in mere days affecting hundreds of thousands of street customers. From April 1, 2025, drivers can be hit with new automobile tax modifications – many having been introduced by the Chancellor in October’s Autumn Statement.

Vehicle Excise Duty (VED) will enhance for automobiles, vans, and bikes – though it’s going to exclude first yr charges for automobiles. Electric automobile house owners will even need to pay for the primary time ever. It can be elevated in step with RPI inflation.

Models registered between 2001 and 2017 can be affected extra dramatically below new Vehicle Excise Duty (VED) hikes.

Cars manufactured over the 16-year interval are charged VED primarily based on how a lot air pollution fashions emit as an alternative of a flat charge. Motorists are positioned into bands primarily based on emissions ranges with prices dramatically various.

Richard Evans, spokesperson for webuyanycar, revealed that just about 20 million automobiles might be affected by the change.

He mentioned: “From April 2025, road tax is expected to increase for every vehicle. The aim is to encourage more lower-emission and electric vehicles on the road.”

He added: “Additionally, for pre-2017 vehicles running on diesel or petrol and emitting over 76g/km of CO2, the first-year tax will double compared to the current rate. Taking steps towards a more eco-friendly road can only be seen positively and as electric vehicles become increasingly popular amongst car buyers, securing 21.6% of the market share, these Budget announcements will come as no surprise to many.

“For these with autos manufactured earlier than 2017, who could also be affected by these street tax will increase, it might be time to contemplate swapping your automobile for a brand new, extra environmentally pleasant mannequin.”

The Chancellor might additionally introduced modifications to the Expensive Car Supplement (ECS) within the Spring Statement. The ECS prices £410 for the primary 5 years and is paid by house owners of vehciles with an inventory value of over £40,000.

Electric autos (EVs) will not be exempt from VED. EVs registered after 1 April can be answerable for a first-year price of £10 till 2029, however these costing over £40,000 will even need to pay the ‘Expensive Car Supplement’ or luxurious automobile tax, which is £425 per yr.

EVs registered between 1 April 2017 and 31 March 2025 will now be topic to the identical commonplace street tax price (£195 yearly) as different motorists.

Cars emitting between 1-50 g/km of CO2, which incorporates most plug-in hybrids, will see their first-year tax invoice enhance to £110. Previously, hybrids on this band paid no VED within the first yr, whereas petrol and diesel automobiles paid £10.

New automobiles emitting between 51-75g/km of CO2 will see their automobile tax rise from £30 (or £20 for hybrids) to £135.

First Year Rates (Lighthouse) of BY will fluctuate based on the carbon dioxide (CO2) emissions of the automobile. Cars producing no emissions pays £10 for the primary yr, after which the £195 commonplace price from the second yr. This means house owners of automobiles emitting essentially the most air pollution might pay as much as £5,490.