Recent Road Tax Changes Guide |
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Car tax, formally as Vehicle Excise Duty (VED) on all models registered before 1st March 2001 was based on engine size. There was one rate for capacity up to and including 1549cc and another for sizes over 1549cc. Since then, the rates have been determined by CO2 emissions and type of fuel used. This information is contained on the car’s log book - also called a V5 document. What changed?
Following last years budget, the more polluting cars will now have to pay up to £30 a year more in car tax, while less polluting cars could have to pay up to £30 a year less. Additionally, buyers of newly registered, polluting models must also pay a one-off first-year “showroom tax” – which could cost as much as £950. Eco-friendly drivers purchasing a new car with emissions lower than 130/gkm CO2 will not have to pay car tax in the first year. The number of tax bands increased from seven to thirteen in 2009, with greener drivers being rewarded with lower tax bills, but owners of high-emission cars being hit with higher charges. Cars in band A are greener (and therefore cheaper to tax) than band M. Current UK Road Tax Bands
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The car tax system has become very complex, but, in brief, the lower the emissions, the cheaper the tax disc.