There’s no doubt that owning a car is an expensive business these days, with the cost of fuel and repairs. And the Road Tax we all pay simply adds insult to injury. But unfortunately, new measures that look set to come into action in April could see the situation become worse and mean motorists could be paying a fortune for some cars.
Green tax hike
Nicknamed the ‘green tax hike’, the measures were put in place by former chancellor George Osbourne two years ago, and are due to start this April. The rules are meant to reflect changes in emissions technologies that see cars having lower emissions than previously. The current bands were put into place back in 2001 when the average emissions from each car were higher than today. This means that more cars were able to classify as clean enough to be tax exempt.
But under the new rules for Vehicle Tax, only electric and hydrogen cars will be exempt from the tax. And this means that the cars previously classed as being low emissions could find themselves recategorized.
While owners of those electric and hydrogen cars will remain tax-free, other cars will face a flat rate of £140 in the first year, depending on the emissions from it. This payment is likely to be a lot higher than these motorists are currently paying and is already causing many people to ring the DVLA tax contact number to query what their likely Road Tax bill is going to be.
Despite the recent scandals about falsified tests, car manufacturers have made a lot of improvements to the amount of emissions their cars put out over the last 15-20 years. The current level says that cars emitting less than 100g/km aren’t required to pay any Vehicle Tax and this applies to around 75% of the cars on the road at the moment.
However, this means that there are a lot of cars that don’t generate any income from the tax for the government and in light of austerity and the urge to get us all paying as much as possible for taxes, the government decided to change the rules. So, there are no exclusions for any types of cars, apart from electric and hydrogen ones.
And to make matters worse, it isn’t even that straightforward as there are different amounts to be paid depending on the amount of emissions given out by the car.
For example, a car that emits 99g/km that is bought before the new changes come in on April 1st will remain tax-free for life. However, that same car bought on April 2nd will face a charge of £120 for the first year’s tax and £140 a year for each year after that.
There is also a one-off charge for the first year the car is on the road, depending on the emissions. There is a total of 13 bands being used ranging from cars emitting zero emissions right up to those over the 255g/km band. To make matters even more complicated, cars worth over £40,000 will face an additional cost.
This means cars that are in the highest emissions bracket and the higher price range could see their road tax rise from £1100 a year to £2000. There is the argument that people owning these cars can perhaps better afford it but it is still a substantial percentage increase.
For drivers unsure about how much Road Tax their car will attract under the new rules, you can phone the DVLA Tax contact number and they should be able to give you an idea. You can also still pay tax by Direct Debit to ease the initial outlay come due date.