How Will the Changes to Car Tax Affect Me?

You may have heard the government have planned to introduce changes to car tax in April this year. Many people have been left wondering how these changes might impact them.

The changes focus around the environmental excise duty, which aims to penalise people for driving cars with high emissions – however, the changes will only apply to new cars, so those with existing higher-emission vehicles do not need to panic at the moment.

The changes will also mean that if you are purchasing a more expensive type of car, you’ll find that you are hit with a bigger tax bill – some of those purchasing high-emission, high-cost vehicles in 2017 may find themselves hit with a bill of up to £2,000 more than under the previous system.

These high costs will be reduced after the first year – from the second year, drivers will instead pay one of three yearly rates depending on their chosen vehicle. Those with petrol or diesel powered vehicles will pay £140 a year, hybrid-type vehicles will pay £130, and those with fully electric/ zero emissions vehicles will be charged £0 per year.

On top of these rates, high-cost vehicles, and those which are high polluters, will be subject to an additional fee every year for the first five years. Some drivers may find themselves paying significantly more tax than they would have under the previous system.

Research which was recently carried about by comparison site confused.com has shown that around 60 per cent of drivers are not aware of these changes and how they may affect them.

The changes are thought to have been brought in to encourage people to buy cars with lower emissions.

If you are considering buying a new car in 2017, ensure that you research the tax implications fully before purchase.

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