Drivers of certain vehicles to be hit with new car tax charges in months
Vehicle Excise Duty rates will apply to electric car owners from April in a major blow, with certain models hit hardest by the changes. The DVLA insists this new charge is about fairness
by Rom Preston-Ellis, Luke Chillingsworth · The MirrorElectric vehicle enthusiasts are in for a shock as the Treasury's latest move will see owners of popular models like the Tesla Model 3, MG4, Porsche Taycan and Mercedes EQS facing higher car tax from next spring.
Currently enjoying a free pass on Vehicle Excise Duty (VED), EV drivers are set to be hit with the same charges as petrol and diesel motorists starting April 2025, marking a significant shift for eco-conscious drivers. The change means that from 2025, EV owners will have to cough up £190 annually, a tenner more than the current £180 rate for traditional vehicles.
The DVLA insists this new charge is about fairness, stating that it will ensure all motorists "pay a fairer tax contribution" for road use. They clarified: "From 1 April 2025, drivers of electric and low emission cars, vans and motorcycles will need to pay vehicle tax in the same way as drivers of internal combustion engine (ICE) vehicles do.
"This change will apply to both new and existing vehicles and will ensure all drivers begin to pay a fairer tax contribution." In a blow to zero-emission driving incentives, the new system will scrap the £0 band A under the graduated VED system, forcing these vehicles into the first payable rate band, reports the Express.
Carparison Leasing reveals that the Tesla Model Y reigns as the UK's favourite electric ride, followed by the MG4 EV, Audi Q4 e-tron, Tesla Model 3, and Polestar 2. Other EVs set to feel the pinch include the Volkswagen ID. 3, Kia Niro Electric, and BMW i4, as they too will fall under the new tax regime.
Electric vehicle (EV) owners could be hit with a 'luxury car tax' that might see them forking out an extra £410, as the supplement targets vehicles valued over £40,000. Despite being rare among petrol and diesel cars, the steep initial price of EVs means many drivers are likely to cross this financial threshold.
New analysis warns that up to 70% of EV owners could be stung by this surcharge, delivering a significant blow to eco-conscious motorists. The levy also affects those buying second-hand EVs, with the 'expensive car supplement' lingering for five years from the vehicle's first registration.
Mike Hawes, chairman of the Society of Motor Manufacturers and Traders (SMMT), has voiced concerns that a considerable number of drivers will be "punished" by these impending changes next year. He stressed: "Next year's planned changes to extend the VED expensive car supplement to EVs will see a significant portion of these zero-emission vehicles classed as 'luxuries', right when manufacturers are mandated by law to increase the proportion they sell."