The Chancellor confirmed the change in her November 2025 Budget, with a new list a fees becoming active on April 1.
The Chancellor confirmed the change last year in line with the RPI (Image: Getty)
Drivers are now having to fork out more in vehicle excise duty. The new rate for low-emission cars registered after April 2017 that produce between one and 50g/km of CO2 is £115 for the first year, having risen from £110 previously. Applying to internal combustion engine (ICE) and hybrid cars, this then increases, depending on how polluting the vehicle is.
It comes after the Chancellor, Rachel Reeves, confirmed in her 2025 Budget that the Government will uprate Vehicle Excise Duty (VED) rates for cars, vans and motorcycles in line with the retail price index (RPI) from April 1. An exemption was announced for search and rescue vehicles, but this will not be in place until from April 2027.
The Government also said at the time that it will uprate VED for heavy goods vehicles (HGVs) in line with the RPI from April 1, as well as the heavy goods vehicle levy. In addition, ministers confirmed that they will increase the VED Expensive Car Supplement threshold to £50,000 for zero-emission vehicles only.
UK drivers are having to fork out more (Image: Getty)
This change applies to zero emission vehicles (ZEVs) registered from April 1, 2025, onwards.
Electric cars will have to pay the new electric vehicle excise duty (eVED), a mileage charge for electric and plug-in hybrid cars, from April 2028.
The Bugdet explained: “Drivers will pay for their mileage on a per-mile basis alongside their existing Vehicle Excise Duty.
“Electric cars will pay half the equivalent fuel duty rate for petrol and diesel cars, and plug-in hybrid cars will pay a reduced rate equivalent to half of the electric car rate.
“The government has published a consultation which provides further detail on how eVED will work and seeks views on its implementation.”
A consultation was to remain open until March 18 this year.
The RAC has outlined the new charges for cars.
Tax bands for cars registered after April 2017
| CO2 emissions (g/km) | First year rate | Standard rate |
|---|---|---|
| 0g/km | £10 | £200 |
| 1 – 50 | £115 | £200 |
| 51 – 75 | £135 | £200 |
| 76 – 90 | £280 | £200 |
| 91 – 100 | £365 | £200 |
| 101 – 110 | £405 | £200 |
| 111 – 130 | £455 | £200 |
| 131 – 150 | £560 | £200 |
| 151 – 170 | £1410 | £200 |
| 171 – 190 | £2270 | £200 |
| 191 – 225 | £3420 | £200 |
| 226 – 255 | £4850 | £200 |
| Over 255 | £5690 | £200 |
Tax bands for cars registered after March 2001 and before April 2017
| VED band | CO2 emissions | Annual rate |
|---|---|---|
| A | Up to 100g/km | £20 |
| B | 101-110g/km | £20 |
| C | 111-120g/km | £35 |
| D | 121-130g/km | £170 |
| E | 131-140g/km | £200 |
| F | 141-150g/km | £225 |
| G | 151-165g/km | £275 |
| H | 166-175g/km | £325 |
| I | 176-185g/km | £360 |
| J | 186-200g/km | £410 |
| K | 201-225g/km | £445 |
| L | 226-255g/km | £760 |
| M | Over 255g/km | £790 |