It may be April 1st, but for buyers trying to decide whether the time is right to go electric, the new Vehicle Excise Duty numbers that come into force today are no joke. The changes, which have been on the cards for a while, are aimed at pushing drivers - those with company cars in particular - into cleaner (read: electric) vehicles.
In addition to the standard increase in line with inflation, VED will now be calculated using the newer more accurate WLTP figures, rather than the results of the previous NEDC system - typically resulting in a higher CO2 average.
Diesel cars that don't comply with the criteria for RDE2 (Real Driving Emissions Step 2) will also be punished, paying a higher rate than their cleaner-diesel or petrol equivalents, as per the chart below.
Even if your new car does meet the RDE2 standard, you could still be in for a pricey shock when it comes to register it for the first time. One-off first year charges now rise as high as £2,175 for cars which emit over 225g of CO2 per km. The step between 225 and 226g/km is particularly brutal, with the £545 difference representing a greater penalty than the £540 extra you'd have to spend in moving from a car with zero emissions to one with 170g/km.
The news is rather better for electric vehicles, which not only see the benefit-in-kind car tax associated with company cars removed, but also become exempt from the £320-a-year 'expensive car' tax. This applies to vehicles with purchase prices greater than £40,000, meaning that buyers of premium EVs from Tesla, Audi, Porsche et al should benefit. It's also retroactively applied, meaning anyone already owns such a vehicle will not have to pay the fee going forward.
Obviously the amount VED will actually cost can still vary depending on whether you choose to pay it all upfront in one lump sum, or spread it across 12 monthly payments. The long and the short of this year's changes, though, are to incentivise buyers to make the switch to electric cars, and away from high-polluting diesels, sooner rather than later. For PHers on the fence about taking the plunge, does the change provide you with sufficient motivation?
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