New car tax rates from April 1 will hit petrol and diesel drivers

On April 1, 2024, VED costs will go up with the Retail Price Index (RPI) inflation rate. Pictured is Maid Marian Way in Nottingham.

Drivers of petrol, diesel and hybrid cars will see new car tax rates starting from April 1. The Vehicle Excise Duty (VED) is going up, which might mean paying a lot more.

On April 1, 2024, VED costs will go up with the Retail Price Index (RPI) inflation rate. HM Revenue and Customs (HMRC) has said that although the rates “will remain unchanged in real terms”, it will still “impact” those who own vehicles.

The VED you pay mostly depends on your car’s pollution level. This means owners of more polluting petrol and diesel cars will be hit hardest. If you have a petrol, diesel or hybrid car, get ready to pay extra when the new VED rates kick in this spring, says the Star.

But if your car is fully electric, you don’t have to worry about VED fees for now. But this might change from April 2025. The cost for you will depend on your car’s age and pollution level. Cars registered after April 1, 2017, will see a £10 increase, with standard rates rising from £180 to £190.

If you’ve bought a brand new car worth more than £40,000 in the last five years, you’ll have to pay an extra fee called the Expensive Car Supplement. This will add an additional £410 to your bill from April, up from £390 over the financial year.

If you’ve purchased a brand-new car in the past year, these changes could affect your wallet. Cars that emit more than 255 g/km will have to pay an extra £140 in their first-year tax, making the total bill £2,745. But what about older cars? Cars that were first registered on or after March 1, 2001, are put into groups based on how much they pollute. If your car is in the top Band M group, you’ll have to pay £40 more, with the yearly cost going up from £695 to £735.

If your car is in Band L, the cost will go up by £35, while Bands K and J will see a rise of £20. Even cars that don’t pollute as much will see a price increase, but it won’t be as much. Cars with big engines (over 1549cc) that were registered before March 1, 2001, will have to pay an extra £20. If your car’s engine is smaller than 1549cc, you’ll only have to pay £10 more.