DVLA TO SEND OUT 'URGENT' LETTERS TO MILLIONS OF DRIVERS 'WITHIN WEEKS'
Motorists across the nation may soon be receiving official DVLA correspondence "within weeks" – even if they've not had such a letter before. The reason for this potential postal flurry is tied to a substantial overhaul in Vehicle Excise Duty (VED) and car taxation regulations, which could place millions of drivers at risk of facing unexpected charges.
Given recent announcements, from registration, new cars will initially benefit from the lowest first-year VED rate, presently set at £10, while vans will be subject to the standard charge, currently pegged at £345. Subsequent to this introductory period, a standard rate will apply annually on the date of the vehicle’s registration anniversary.
As it stands, the VED for the tax year 2025/26 is fixed at £195 for cars and remains at £345 for vans, with both figures subject to inflation-based increases each year. Matt Walters, who leads Consultancy Services and Customer Value at Ayvens, delved into the implications of the fiscal adjustments, saying: "New cars bear the brunt of tax changes."
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He expounded on the challenges ahead as he shed light on the intricacies of these revisions: "This has left fleets and private motorists in the dark about a tax policy that could cost electric vehicle drivers an additional £1,300 over a four-year lease contract."
Noting the paradox of encouraging environmental responsibility while confronting logistical hurdles, he outlined the trials facing vehicle fleets: "Despite growing pressure on fleets to reduce CO2 emissions, operators are facing challenges with reduced payload and range, charging networks with spaces designed for cars, and additional administrative burdens for the largest vans.", reports Birmingham Live.
Furthermore, an Expensive Car Supplement, introduced in 2017 targeting petrol and diesel vehicles with a list price exceeding £40k, will soon encompass brand new electric cars starting from April 2025. This charge applies between the second and sixth year, effectively compounding the standard VED fee. In the 2025/26 financial year, the supplement will be set at £425 annually and will not apply to vans. The government has also scrapped the £10 discount on the standard rate for hybrid vehicles.
Cars with CO2 emissions of 76 grams or more per kilometre will see their first-year registration rates doubled, while those with emissions between 1g and 75g of CO2 per kilometre will face a £100 increase. Vehicle Excise Duty (VED), also known as Road Tax or Road Fund Licence, is a tax levied on vehicles based on their type and date of first registration.
2025-04-24T16:57:01Z