{"id":119569,"date":"2026-04-22T11:30:00","date_gmt":"2026-04-22T10:30:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=119569"},"modified":"2026-04-22T10:47:54","modified_gmt":"2026-04-22T09:47:54","slug":"uk-car-tax-is-rising-again","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/uk-car-tax-is-rising-again\/","title":{"rendered":"Up to \u00a3360 a Year: Why UK Car Tax Is Rising Again"},"content":{"rendered":"\n<p><strong>New Vehicle Excise Duty (VED)<\/strong> changes confirmed by Chancellor <strong>Rachel Reeves<\/strong> are set to increase costs for many UK motorists, with some drivers facing annual charges of up to <strong>\u00a3360<\/strong> from the <strong>2026\/27 tax year.<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">\u00a3360 VED Charge to Impact Van Owners<\/h2>\n\n\n\n<p>One of the most direct changes concerns <strong>van drivers<\/strong>, many of whom will see their annual tax rise from<strong> \u00a3345 to \u00a3360<\/strong>. This increase applies to the majority of vans outside older emissions categories and represents a higher jump than in previous years.<\/p>\n\n\n\n<p>By contrast, some<strong> Euro 4 and Euro 5<\/strong> <strong>vans<\/strong> registered after March 2001 will continue to pay <strong>\u00a3140 per year<\/strong>, with no increase applied. This creates a clear divide between older compliant models and more recent vehicles subject to higher rates.<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full\"><img decoding=\"async\" width=\"1000\" height=\"667\" src=\"https:\/\/en.econostrum.info\/uk\/wp-content\/uploads\/sites\/6\/2026\/04\/shutterstock_2565649155.jpg\" alt=\"\" class=\"wp-image-119575\" srcset=\"https:\/\/en.econostrum.info\/uk\/wp-content\/uploads\/sites\/6\/2026\/04\/shutterstock_2565649155.jpg 1000w, https:\/\/en.econostrum.info\/uk\/wp-content\/uploads\/sites\/6\/2026\/04\/shutterstock_2565649155-380x253.jpg 380w, https:\/\/en.econostrum.info\/uk\/wp-content\/uploads\/sites\/6\/2026\/04\/shutterstock_2565649155-520x347.jpg 520w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><figcaption class=\"wp-element-caption\">Chancellor Rachel Reeves has confirmed a tax hike for drivers. \u00a9Shutterstock<\/figcaption><\/figure><\/div>\n\n\n<h2 class=\"wp-block-heading\">New Car Tax Rules Extend Across All Vehicle Types<\/h2>\n\n\n\n<p>The updated <strong><a href=\"https:\/\/commonslibrary.parliament.uk\/research-briefings\/sn01482\/\" target=\"_blank\" rel=\"noopener\">VED system<\/a><\/strong> affects a broad range of vehicles, including <strong>petrol, diesel, and electric cars<\/strong>. The inclusion of electric vehicles reflects a shift in policy, as more drivers transition away from traditional engines.<\/p>\n\n\n\n<p>Cars registered after <strong>2017<\/strong> will generally face a flat annual charge of around <strong>\u00a3200<\/strong>, regardless of fuel type. This standard rate simplifies the system for newer vehicles but still represents a recurring cost for drivers who were previously less affected.<\/p>\n\n\n\n<p>For vehicles registered between <strong>2001 and 2017<\/strong>, taxation remains based on CO\u2082 emissions, with <strong>143 different tax<\/strong> <strong>bands<\/strong> in place. Depending on the emissions level, some drivers in this category could pay up to <strong>\u00a3790 per year.<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Rachel Reeves confirms \u00a3760 charge for drivers in &#39;humble&#39; cars <a href=\"https:\/\/t.co\/K6CXsdtA7L\">https:\/\/t.co\/K6CXsdtA7L<\/a><\/p>&mdash; Birmingham Live (@birmingham_live) <a href=\"https:\/\/twitter.com\/birmingham_live\/status\/2046872273030647923?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"noopener\">April 22, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">Higher Costs for New and Premium Vehicles<\/h2>\n\n\n\n<p>Owners of brand-new cars may face significantly higher charges, particularly in the early years of ownership. In some cases, total annual costs can reach <strong>\u00a35,690<\/strong>, depending on the vehicle\u2019s value and specifications.<\/p>\n\n\n\n<p>These higher rates are linked to existing rules targeting more expensive vehicles, where additional charges apply during the first years after purchase. This system is designed to reflect both emissions and vehicle value.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Why the Government Is Increasing Car Tax<\/h2>\n\n\n\n<p>The revision of <a href=\"https:\/\/www.rac.co.uk\/drive\/advice\/buying-and-selling-guides\/car-tax-bands-explained\/\" target=\"_blank\" rel=\"noopener\"><strong>VED rates<\/strong><\/a> is part of a broader effort to adjust the UK\u2019s taxation system as driving habits and vehicle types evolve. With more <strong>electric vehicles<\/strong> entering the market, the tax base is expanding to include drivers who previously paid little or no road tax.<\/p>\n\n\n\n<p>At the same time, incremental increases in standard rates continue to raise <strong>ownership costs<\/strong>, contributing to wider concerns about household expenses.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What It Means for Drivers in 2026<\/h2>\n\n\n\n<p>For UK motorists, these changes mean that <a href=\"https:\/\/en.econostrum.info\/uk\/new-car-tax-proposal-hit-rural-uk-households\/\" target=\"_blank\" rel=\"noopener\">annual car tax bills<\/a> are likely to rise depending on the type and age of their vehicle. While some drivers will see minimal changes, others\u2014particularly van owners and those with higher-emission vehicles\u2014will face increased costs.<\/p>\n\n\n\n<p>Understanding which <strong>VED band<\/strong> applies will become more important as the new rules take effect. For many households, these changes add another factor to consider when budgeting for vehicle ownership in the coming years.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>New car tax rules are set to push costs higher for many UK drivers, with some facing steep annual charges from 2026. As changes extend across different vehicle types, the impact could be wider than expected. Who will pay more\u2014and how much could it really cost?<\/p>\n","protected":false},"author":6,"featured_media":119574,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29],"tags":[],"class_list":["post-119569","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-taxation","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33","no-featured-image-padding"],"_links":{"self":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/119569","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/comments?post=119569"}],"version-history":[{"count":2,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/119569\/revisions"}],"predecessor-version":[{"id":119579,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/119569\/revisions\/119579"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media\/119574"}],"wp:attachment":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media?parent=119569"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/categories?post=119569"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/tags?post=119569"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}