Pricey petrol not bad enough? Drivers brace for £200 road tax in April
The price of Vehicle Excise Duty will rise by £5 to £200 per year, or £640 for cars subject to the Expensive Car Supplement
Drivers are set to be hit with even more price rises when the cost of road tax rises to £200, with more expensive models subject to a yearly duty of as much as £640.
Vehicle Excise Duty, more commonly referred to as ‘road tax’, typically rises annually with inflation, and this year is no different. The yearly cost to tax a car first registered after 1 April 2017 has now increased by around two-and-a-half per cent from £195 to £200. This is actually slightly lower than the current Retail Price Index, which says inflation in the UK is running at 3.2 per cent.
That’s not all, though, because the cost of the Expensive Car Supplement (ECS) has also risen from £425 to £440. This additional surcharge is only applied to vehicles with an official list price of over £40,000 and is paid annually on top of the standard VED rate between years two and five of ownership.
However, it’s not all bad news because April also introduces a higher threshold for the ECS for electric cars; from that point, EVs can now cost up to £50,000 from new without attracting the surcharge. On the other hand, it is now the second year that electric cars are subject to the standard rate of road tax. That’s not to mention the fact that the pay-per-mile tax is set to arrive in 2028 and could cost EV drivers as much as three pence per mile on top of the usual VED rate.
For drivers of older cars, the price of road tax is generally up across the board; while the most environmentally friendly cars still pay £20-35 per year, the heaviest polluters are now charged £790 – £30 more than before.
All of this comes alongside skyrocketing costs for drivers; according to the RAC, between the end of February and the middle of March, petrol prices rose from around 132 pence per litre to around 142. A 10-pence rise such as this will cost the driver of an average family car with a 55-litre fuel tank an extra £5.50 per fill-up. An ‘unwinding’ of the temporary five pence cut to fuel duty would raise prices at the pump even further, although the Government says this plan is “under review” as a result of the ongoing conflict in the Middle East.
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