Crown Commercial Service

Don’t forget that car tax regulations change on 1 April

I just wanted to remind you that new Vehicle Excise Duty (VED) regulations – commonly known as car tax – are coming into force on 1 April 2017.

What is changing?
Just like the current system, new cars will be divided into 13 bands based on their carbon emissions. This determines how much you pay in the first year of ownership. The amount paid each year after that will depend on the type of fuel the car uses.

These tables show the new rates based on fuel type – alternative fuels include hybrids, bi-ethanol and liquid petroleum gas:

Petrol and diesel cars                                                    Alternative fuel cars

CO2 emissions (g/km) First year Standard rate*       (after 12 months) CO2 emissions (g/km) First year Standard rate* (after 12 months)
0 £0 £0 0 £0 £0
1-50 £10 £140 1-50 £0 £130
51-75 £25 £140 51-75 £15 £130
76-90 £100 £140 76-90 £90 £130
91-100 £120 £140 91-100 £110 £130
101-110 £140 £140 101-110 £130 £130
111-130 £160 £140 111-130 £150 £130
131-150 £200 £140 131-150 £190 £130
151-170 £500 £140 151-170 £490 £130
171-190 £800 £140 171-190 £790 £130
191-225 £1,200 £140 191-225 £1,190 £130
226-255 £1,700 £140 226-255 £1,690 £130
256+ £2,000 £140 256+ £1,990 £130

*Cars costing over £40,000 will pay an additional tax of £310 for 5 years

These rate changes will only apply to new cars registered from 1 April 2017 onwards.

Cars costing more than £40,000
Cars registered after 1 April 2017 with a list price (the published price before any discounts) of more than £40,000 will attract an additional rate of £310 a year for 5 years. This additional rate will only apply after the first 12 months.

Fuel Type Standard rate Additional rate Total annual amount
Electric £0 £310 £310
Alternative fuel £130 £310 £440
Petrol/diesel £140 £310 £450

After 5 years, depending on the fuel type, the standard annual rate will then apply.

Find out more
You can find further information online on GOV.UK. Got a question? Please get in touch.

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