Petrol, diesel and electric car drivers will be hit with higher car tax bands from April 1 as new Vehicle Excise Duty (VED) rates come into effect. Traditional petrol and diesel combustion models will be the most affected, with rises across the board and almost every vehicle affected.
However, some cars will be more impacted than others, with certain road users set to be slapped with the biggest price hikes within months. Brand new, highly polluting petrol and diesel models face the steepest hikes, with new owners of cars straight off the production line that emit over 255g/km of CO2 set to pay £200 more.
These first-year VED bills doubled last year, with rates rising from £2.745 per year to an eye-watering £5,490 per annum. However, motorists are set for another inflationary rise come April 1, with bills jumping to a whopping £5,690.
It’s not the only sizeable hike, with higher first-year VED tax rises applying to vehicles on a sliding scale depending on vehicle emissions data. Cars emitting between 226 and 255g/km of fuel will pay£4,850 per year to use the roads, £170 more than the current £4,680 fee.
HM Revenue and Customs (HMRC) previously revealed new uprated VED rates would come into effect from April 1, with Labour since confirming fees would rise.
Exchequer Secretary Dan Tomlinson stated: “Vehicle Excise Duty (VED), sometimes known as ‘road tax’ or ‘vehicle tax’, is a tax on vehicles used or kept on public roads.
“Different rates apply to cars, vans, and motorcycles, and the rate for each vehicle is calculated according to a range of factors, such as its date of first registration, weight, or CO2 emissions.
“As announced by the government at Budget, from 1 April 2026, VED rates for cars, vans, motorcycles and heavy goods vehicles (HGVs) will be uprated in line with the Retail Price Index (RPI) in 2026-27.”
