February 20, 2017 at 4:22 PM
One of George Osborne's last acts as the Chancellor of the Exchequer was to make substantial changes to the way in which road tax is calculated. The changes that he made will come into force in 2017, and so it is important to be aware of what they will entail. Below you will be able to read all about the three key points of change associated with the new VED: changing tax bands, fewer exemptions to road tax and a new flat rate.
In 2017, your vehicle's tax band will almost certainly change. This is because the 2017 VED is one of the most substantial ever shifts in the way in which car tax bands are calculated. Across the board, car owners will tend to find themselves paying more tax, though the greatest increases will be experienced by drivers of smaller and more economical vehicles. It will still generally be the case that drivers of high-emission vehicles will pay more tax than others, but there will be some notable exceptions - so check with your garage if you are unsure.
New cars will be subject to increasing tax demands as the year's progress until a new annual flat rate of £140 per annum will apply to them.
At the moment, if you drive a diesel car or if you drive any low emission vehicle, you do not have to pay road tax. When the new 2017 regulations come into force, this will not be the case. In fact, the only vehicles that are exempt from road tax under the 2017 VED will be vehicles that do not have any tailpipe emissions - that practically restricts tax-exempt vehicles to electric and hydraulic cars.
If your vehicle is worth £40, 000 or more, there will be an additional charge to pay on top of everything else. This will be £310 every five years.
You can avoid the increases in road tax for your vehicle as long as you register it to you before the 2017 tax year begins.
Now that you are aware of the fees involved in the 2017 VED, it is a good idea to ensure that you have some extra money set aside so that you will be able to cover them.