Low emissions cars to be hit by new VED Tax

Motor Trade News

January 16, 2017

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VED Rates

A significant aspect of the government’s new Vehicle Excise Duty (VED) tax rules, which come into force on 1 April, is that only zero emissions vehicles will qualify for exemption.

Following an analysis of the new scheme Honest John’s Managing Editor, Daniel Powell, suggests that it will add more than £500 to the long-term running costs of Britain’s most-popular and eco-friendly cars, while owners of the most-polluting vehicles could save up to £245. The figures are based around a four year cycle and example cited at either end of the eco scale are the Ford Fiesta 1.0 EcoBoost 100PS, which will cost £540 more to tax over four years, and the V8 Ford Mustang which will be £245 cheaper over the same period of time.

While the current rules offer VED exemptions to vehicles that emit sub-99g/, the replacement schemem will be costly to owners of hybrid cars, with buyers of the Toyota Prius paying an extra £405 over four years.

A recent online polln of more than 4,000 people conducted by Carbuyer, found that 86% of the respondents were completely unaware of the new tax regime. Just 6% were fully aware of it.

Honest John’s Managing Editor, Daniel Powell, said: “Many motorists are unaware of the changes that are coming for VED, but the fact of the matter is this – the system is changing, and low emissions cars won’t be as tax efficient as they were before. It’s a bit of a mixed message to increase tax on fuel efficient cars while reducing it on less eco-friendly models when the government is trying to increase the uptake of low and zero-emissions cars.”