
Major Car Tax Changes in the UK Could Hit Older Drivers Hard in April 2025
As the UK faces a significant shift in vehicle taxation, millions of drivers, especially those with older cars, are gearing up for hefty increases in their annual car tax bills. Starting April 1, 2025, the government is set to implement sweeping changes to the Vehicle Excise Duty (VED), impacting not only owners of petrol and diesel vehicles but also electric vehicle (EV) owners. While these changes are aimed at reducing emissions and encouraging the transition to greener vehicles, they are expected to bring financial strain to many, particularly older drivers.
Under the new rules, the standard rate of car tax for vehicles, including cars, vans, and motorcycles, will rise in line with inflation, as measured by the Retail Price Index (RPI). But this is just the beginning of the changes. One of the most significant impacts will be felt by owners of older vehicles, specifically those registered between March 1, 2001, and March 31, 2017. These drivers have been paying taxes based on the fuel type and CO2 emissions of their vehicles, with rates spread across 13 bands from A to M. However, the new rules are tightening the emissions bands, causing many older cars, particularly those with higher CO2 emissions, to face significant tax hikes.
For example, vehicles emitting less than 100g of CO2 per kilometre were previously exempt from tax, but now they will be subject to new charges. The most polluting cars, those emitting more than 255g of CO2, could see their annual tax bills rise to a staggering £5,490. This is a massive jump from the current tax rate, which is already high at £735 for the most polluting vehicles.
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The changes will also affect new car buyers. Electric vehicles, which have been previously exempt from VED, will now be subject to a first-year charge of £10, a sharp contrast to the current £0 rate. For petrol and diesel vehicles emitting between 1-50g of CO2 per kilometre, the first-year tax will rise to £110. All vehicles emitting more than 76g/km of CO2 will face rate increases, with the most significant rises for high-emission models.
In terms of number plates, drivers will be able to gauge whether their vehicle is impacted by checking the age identifier on their registration plates. The identifier, made up of two numbers, changes every six months. The introduction of the "25" plate in March 2025 will mark the beginning of the new changes, while those with cars registered under "75" plates in September 2025 will also be subject to the updated tax rules.
These increases are part of a broader government push to address climate concerns by encouraging a shift towards electric vehicles. However, many drivers, especially older motorists who may be on fixed incomes, are voicing their concerns. Many fear that the financial burden of these changes will hit them hardest, particularly as living costs continue to rise.
The most significant backlash is expected from those who have been loyal to their older cars, many of which may not meet the new, stricter emissions standards. Some have raised concerns that the changes could disproportionately affect elderly drivers, who may be less able to afford the sudden rise in car taxes.
So, the impending car tax hikes are set to affect millions of UK motorists, but it is the owners of older vehicles, particularly those with high emissions, who are expected to bear the brunt of these changes. With electric cars set to become more expensive as well, the road ahead for UK drivers looks financially challenging, particularly for those already feeling the strain of the cost of living.
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