HomeNews January 2017 Road tax has increased for all new cars...

Road tax has increased for all new cars...

28 January 2017

Road tax has increased for all new cars... From 1st April 2017, the amount you pay for VED (also known as road tax) on brand new vehicles has increased for 7 out of 10 owners and some drivers now have to pay VED for the first time. Read on to find out how you may be effected.

Why has VED changed?

As cars have become more economically efficient, the Chancellor has been hit in the pocket! Despite manufacturers and consumers moving to cleaner cars, the motorist is now going to have to pay higher tax charges to make up for the cash lost by low-emissions vehicles.

What are the VED changes?

Anyone buying a brand-new car or motorhome registered after 1 April 2017, will now pay the first year's road tax based on the vehicle’s CO2 emissions – however the first years payments are based on heavily revised calculations which see the charges double from the old levels.

The first year rate, depending on the vehicle's CO2 emissions now range from £0 (for zero emission cars only) up to £2,000. From the second year onward, a flat fee of £140 applies to all new vehicles that are anywhere above zero emissions (except hybrid/alternative fuel cars, which will receive a £10 discount on the standard rate). In addition, any cars with a value of £40,000 or above will also pay an extra £310 per year for the first five years, as a 'premium' car tax.

VED road tax rates for new cars registered on or after 1st April 2017...

CO2 Emissions (g/km) First Year Rate Standard Rate (from 2nd year onward)*
0 £0.00 £0.00
>0 (Hybrid/Alternative Fuel) £10.00 £130.00
1 - 50 £10.00 £140.00
51 - 75 £25.00 £140.00
76 - 90 £100.00 £140.00
91 - 100 £120.00 £140.00
101 - 110 £140.00 £140.00
111 - 130 £160.00 £140.00
131 - 150 £200.00 £140.00
151 - 170 £500.00 £140.00
171 - 190 £800.00 £140.00
191 - 225 £1,200.00 £140.00
226 - 255 £1,700.00 £140.00
Over 255 £2,000.00 £140.00

*Cars worth over £40,000 at the time of purchase will pay an extra £310.00 for 5 years

What this means for new Ford Owners

Buyers of new Ford cars such as the 5.0 Ford Mustang V8 can now save up to £245 over four years when buying their new model after the 1st April 2017. In contrast, buyers of Britain's best-selling new Ford Fiesta with the 1.0 EcoBoost 100PS will pay more, despite the Ford Mustang emitting three times the amount of CO2!

If you would like any more information about how the road tax system has changed, how it might affect you or the new car you are thinking of buying, please contact your local TC Harrison Ford dealership in Burton, Derby, Huntingdon, Peterborough, Spalding, Stamford or St Neots and we'll be happy to assist with any queries you may have.