It was a while ago so you could be forgiven for forgetting, but in the budget announced on 8 July 2015 new Road Tax (VED) rates will come into effect for cars registered on or after 1 April 2017.
The new rates are divided into CO2 emission bands, but this only applies to first year tax costs. From the second year onwards, the rates break down to just three bands, Zero Emissions; Standard (vehicles costing under £40,000); Premium (vehicles costing over £40,000).
A Zero Emissions car will pay no tax whatsoever (unless it costs more than £40,000), a Standard car will cost £140 from year two, while a Premium car that emits any CO2 at all will cost £450 from the second year until the sixth year after registration, when it will cost £140 per year.
This means that, from 2017, the only cars that will be free to tax will be all-electric cars that cost less than £40,000. Even owners of low-emission hybrids that are currently free to tax will have
Remember, these changes won’t apply to your current car – only to new cars registered from April 2017.
|1 - 50||£10||£140||£450|
|51 - 75||£25||£140||£450|
|76 - 90||£100||£140||£450|
|91 - 100||£120||£140||£450|
|101 - 110||£140||£140||£450|
|111 - 130||£160||£140||£450|
|131 - 150||£200||£140||£450|
|151 - 170||£500||£140||£450|
|171 - 190||£800||£140||£450|
|191 - 225||£1,200||£140||£450|
|226 - 255||£1,700||£140||£450|
|More than 255||£2,000||£140||£450|
Here’s an example
SEAT Leon – 1.6-litre diesel - 102g/km CO2
The 1.6 SEAT Leon would currently cost nothing for the first year, then £20 per year to tax under the current system.
Under the 2017 system it would cost £140 per year
to tax every single year.