Millions of UK motorists face higher car tax bills from April 2027, with some drivers set to pay £825 a year under new Vehicle Excise Duty (VED) rates. The changes will affect petrol, diesel and electric vehicles, although the size of the increase will depend on each car’s registration date and emissions.
The latest adjustments form part of the government’s annual revision of road tax charges, which are linked to the Retail Prices Index (RPI). From April 1, 2027, motorists will face updated rates across several vehicle categories, adding another expense to the cost of keeping a car on the road.
While the £825 figure applies to a particular group of older, high-emission vehicles, owners of newer models will also see their bills rise. The changes are being introduced nationally through the Treasury, rather than by Greater Manchester Mayor Andy Burnham, whose name appeared in reports about the new charges.
Car Tax Bills Will Reach £825 for Some Drivers From April 2027
The most substantial annual charges will affect motorists who own vehicles registered between March 1, 2001, and March 31, 2017. These cars are classified under a system of 13 VED bands, ranging from A to M, with annual tax calculated according to carbon dioxide emissions.
Vehicles falling into Band M, the highest category, produce more than 255 grams of CO2 per kilometre. Their owners currently pay £790 annually, but that figure will increase to £825 from April 2027, representing an additional £35.
According to Express.co.uk, motoring specialist Pete Barden highlighted the increase when examining how the latest inflation-linked adjustments would affect drivers. His figures are consistent with the government’s published VED rate tables for the 2027/28 tax year. AOL+1
The rise follows several consecutive increases for drivers in the highest emissions category. Band M motorists paid £735 during the 2024/25 financial year, before the charge increased to £760 in 2025/26 and £790 in 2026/27.
Other categories will also become more expensive. Band L vehicles, which emit between 226 and 255g/km of CO2, will see their annual charge increase from £760 to £795. Meanwhile, Band K motorists will pay £465 instead of £445.
Not every vehicle in the older registration system will experience an increase. Charges for Bands A, B and C will remain unchanged, at £20, £20 and £35 respectively.
The difference highlights how the revised system continues to place a greater financial burden on owners of cars with higher recorded emissions.
Treasury Confirms Inflation-Linked VED Increases for Petrol, Diesel and Electric Cars
The upcoming adjustments are part of a broader government decision to increase Vehicle Excise Duty in line with inflation.
Following the October 2026 Budget, the Treasury confirmed the policy in a statement:
“The government will uprate VED rates for cars, vans and motorcycles in line with the Retail Prices Index (RPI) from 1 April 2027.”
The policy is also detailed in the government’s Budget 2026 tax documentation, which sets out the revised charges for the 2027/28 financial year. GOV.UK+1
For cars first registered on or after April 1, 2017, the standard annual VED rate will increase from £200 to £210. This system differs from the older emissions-based bands because most vehicles in the category pay a flat standard rate after their first year, although certain expensive vehicles face an additional supplement.
Electric cars are also covered by the VED system, meaning the annual revisions are not limited to petrol and diesel drivers.
The changes extend beyond private cars, with updated rates also applying to vans and motorcycles. However, the amount payable varies according to vehicle classification, registration date and other applicable rules.
For motorists who already face higher insurance, maintenance and fuel costs, even a relatively modest annual increase adds to the expense of vehicle ownership.
The April deadline is particularly important because the revised rates will apply when vehicles are taxed or renewed under the new schedule, rather than appearing as a separate payment imposed on every driver simultaneously.
New Cars Could Face First-Year Tax Bills of Up to £5,950
Although the £825 annual charge will attract attention among owners of older vehicles, some buyers of brand-new cars could face considerably higher initial tax payments.
Under the first-year VED system, cars registered from April 2017 are assigned an initial tax rate based on their CO2 emissions. The highest charges fall on vehicles producing the greatest levels of pollution.
From April 1, 2027, newly registered vehicles emitting more than 255g/km of CO2 will face a first-year VED charge of £5,950, compared with £5,690 under the current schedule.
Cars producing between 226 and 255g/km will attract a first-year charge of £5,070, while those emitting between 191 and 225g/km will face a bill of £3,575.
These figures are confirmed in the published 2027/28 tax tables and reflect the significant difference between first-year taxation and the standard annual charge applied in subsequent years. GOV.UK+1
Importantly, the £5,950 figure is not a recurring annual payment for the same vehicle under the standard post-2017 VED system. It applies to the first registration year for qualifying high-emission cars.
After that initial period, the standard annual rate generally applies, although an additional Expensive Car Supplement may be charged to qualifying vehicles during their second through sixth years.
For drivers considering a vehicle purchase before the new financial year, the changes make registration dates and emissions figures especially relevant.
The government’s published schedule confirms that the revised VED charges will take effect nationwide on April 1, 2027, with Band M owners facing an annual rate of £825 and the standard post-2017 charge increasing to £210.
