Petrol and diesel owners will be hit with new car tax bills this Spring, with some motorists forced to pay £200 extra to use the roads. Vehicle Excise Duty (VED) prices rise in line with inflation every April, with bills set to increase once again this April.
Almost all petrol, diesel and electric car owners will pay higher rates, but prices depend on when a car was first registered and its overall emissions. Cars registered after 2017 pay different prices from vehicles built between 2001 and 2017, with costs split into standard and first-year fees.
Standard VED rates are applied to all cars registered after 2017 from their second year on the road, with costs rising from £195 to £200 per year this April. However, first-year rates can vary dramatically, with some road users paying thousands of pounds to get behind the wheel.
Owners of brand-new vehicles emitting over 255g/km of CO2 are most affected, with annual costs rising from £5,490 to £5,690, a staggering £200 increase. Cars emitting between 226 and 255g/km are next, with costs rising from £4,680 to £4,850 per year.
Prices will jump by £120 for vehicles producing between 171 and 190g/km of CO2, as annual costs rise from £3,300 to £3,420. Costs then continue to rise across the board, with owners of low-polluting plug-in hybrid models not even safe.
Average hybrids are likely to fall into the 111-130 g/km of CO2 category, with year one costs rising by £15 from £440 to £455. Only electric car owners are set to pay the same first-year rate as in 2025, retaining their affordable £10 charge.
HM Revenue and Customs has confirmed the rises are a standard uprating in line with Retail Price Index (RPI) inflation. In 2025, first-year fees were dramatically hiked, which saw some owners charged thousands extra as costs doubled.
