As the UK approaches 2026, the vehicle tax landscape is facing significant shifts. The introduction of higher VED bands for vehicles that produce more than 225g of CO2 per kilometre is expected to impact hundreds of thousands of cars on British roads. The changes will affect many vehicles from the 1990s and early 2000s, leaving many owners considering scrapping their cars. The new rates have sparked outrage among motorists, particularly owners of older cars that are still functional but are now facing an economic hurdle to remain on the road.
A petition calling for a 50% reduction in VED for vehicles aged 20 to 39 years has gained significant traction, attracting over 20,000 signatures in just a few weeks. This growing support highlights the frustration surrounding the financial burden placed on owners of these “modern classics” and is pushing the government to respond.
Car Tax and the “Tax Trap”
According to recent reports, certain cars are being caught in what has been dubbed a “tax trap.” The higher VED rates, which range from £430 to £750 annually for many vehicles, will rise further from April 2026. For example, cars emitting over 255g of CO2 per kilometre will see their tax bill increase to £790, a substantial sum that some owners argue is unjustified. This has led to concerns that cars from two decades ago, including popular models like the Ford Mondeo, Volkswagen Golf, and Saab 900, will be scrapped rather than maintained.
The issue is particularly acute for vehicles that are too new to be considered “classics” but too old to benefit from exemptions. Vehicles manufactured before 1 January 1986 are currently exempt from VED, but these newer “modern classics”, which were once cherished for their performance and design, no longer fall under this exemption. As a result, these vehicles are becoming financially unviable for many owners, who are being forced to choose between paying steep tax bills or giving up their cars altogether.
Motor industry experts argue that the high tax rates are unfairly penalising well-maintained vehicles, forcing owners to prematurely scrap cars that still have a lot of life left in them. Wayne Lamport, who operates a classic car dealership, explained that the scrapping trend is particularly evident in cars like the Chrysler PT Cruiser and the Jaguar X-Type, which are now seen as too costly to maintain due to the annual VED charges.
Environmental Concerns and the Push for Change
There is also an environmental argument at play. The carbon footprint of manufacturing a new vehicle is significant, with studies showing that the production of a medium-sized car generates over 17 tonnes of CO2 emissions, nearly equivalent to three years of a typical household’s gas and electricity consumption. Keeping older cars on the road, according to environmental advocates, is more sustainable than building new cars, as it preserves the “embedded carbon” already spent in manufacturing.
The push to keep “modern classics” on the road rather than sending them to the scrap heap has gained support among various environmental groups. Many believe that reducing VED for cars aged 20 to 39 years would be a more sustainable option and could help prevent a “disposable” culture, where functional vehicles are unnecessarily discarded. According to the petition’s organiser, Heitor Mazzotti, reducing VED for this group of cars would “support the circular economy and UK heritage,” ensuring that these vehicles are kept running for longer and contributing less to the waste stream.
