A rise to Vehicle Excise Duty rates – more commonly known as car tax – looks set to sting drivers with major price increases. Drivers of different vehicles will face different Vehicle Excise Duty rates.

In the Spring Budget, UK Chancellor Jeremy Hunt announced a rise in Vehicle Excise Duty rates in accordance with the Retail Price Index (RPI). This impacts both old and new vehicles, but particularly hits owners of petrol, diesel and hybrid cars purchased for over £40,000 in the past five years (1 April 2017 – 31 March 2023). This band of drivers will see their VED rates rise from £355 to £390, on top of the standard rate, which itself has risen by £15.

Petrol or diesel vehicles registered between March 2001 and March 2017 will be classified by lettered Vehicle Excise Duty bands, which are based on the CO2 emissions of vehicles. Depending on where your car is classified within these bands, you can expect to see your Vehicle Excise Duty rates rise by anywhere from £5 to £65.

Vehicles registered before March 2001 will face similar VED rate rises (between £20 and £30), depending on whether the vehicle has an engine size of up to or over 1.55 litres.

Buyers of brand-new vehicles (after 1 April 2023) can expect a similar rise in Vehicle Excise Duty rates. Fully-electric or plug-in hybrid vehicles that emit less than 50g/km CO2 are exempt, with other vehicles facing a rise of anywhere between £5 and £60, depending on the amount of CO2 the car emits.

Upgrade to a greener drive

Get a car finance quote from My Car Credit and find out how upgrading to an electric vehicle might help you save on VED rates.

Rates from 9.9% APR. Representative APR 11.9%

Evolution Funding Ltd T/A My Car Credit

Return to Fun Stuff & News
Return to search

Related articles

What Does ‘Finance’ Mean When Buying a Car?

Read More

PCP Finance Explained – Personal Contract Purchase Guide

Read More

Car Finance vs Personal Loan, what’s best for me?

Read More
My Credit Rating

Excellent

  • You are a home owner
  • You have been on the electoral role for a long period of time
  • You have current credit arrangements and mortgage with no defaults
  • You have no CCJs, credit arrears or missed payments
  • You rarely apply for credit
  • You are employed or self-employed

Good

  • You are on the electoral role
  • You are a home owner or long standing tenant
  • You have a stable employment history
  • You have current credit arrangements with occasional missed payments
  • You have no CCJs

Fair

  • You are or have recently been on the electoral role
  • You may have recently changed address
  • You may have occasional missed payments
  • You may have an old CCJ
  • You may have regularly applied for credit

Poor

  • You may have had frequent changes in address
  • You may not be traceable on the voters roll
  • You may have exceeded credit card limits
  • You may have missed payments on current agreements
  • You may have had a CCJ in the past

Bad

  • You may not be traceable on the voters roll
  • Your credit cards are over their limits
  • You have recent CCJs
  • You may have been refused credit elsewhere
  • You may be in a debt management plan
£

X monthly repayments of
£X

Typical rate

Loan amount

Total payable

X% APR*

£X

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 11.9%, annual interest rate (fixed) 11.87%, 47 monthly payments of £194.81 followed by 1 payment of £204.81 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,860.88, total amount payable £9,360.88.

Evolution Funding Limited, trading as My Car Credit, is a credit broker and not a lender.

Please ensure you can afford the repayments for the duration of the loan before entering into a credit agreement.

*Initial application is a soft search. Should you progress, some lenders may perform a hard search on your credit file.
Reviews icon
TrustPilot icon
Trustpilot

Require more help?

Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!

Email
or call 01246 458 810