► No more free road tax for electric vehicles
► Rates going up elsewhere across the board too
► Drivers of luxury and performance cars face steepest cost increase
Like day and night and the changing of the seasons, car tax or VED ('vehicle excise duty') is one of those inevitable things in life that always comes around.
It's a legal requirement for all vehicles registered in the UK and can be payed yearly, monthly or for 6 months. And no matter who the owner or registered keeper of a car is, it's always something that needs done. Deemed necessary for the government and they'll use the money for a whole host of things, from town upkeep to building projects.
Yet with the rules changing every year, it can be hard to know what (or whether) you need to pay.
So, What's Changing?
For the 2025/26 tax year, the rates for drivers of petrol and diesel vehicles is set to rise across the board, with drivers of new luxury and performance vehicles being the worst hit (more on that in a bit).
Also, drivers of electric vehicles will no longer have a get-out-of-jail-free-card, as they'll actually have to pay for vehicle tax (VED) for the first time.
Technically, you do already need to tax your electric vehicle. Thing is, the cost for electric vehicles is currently £0.
Not so from 1 April 2025.
Which could potentially limit the number of new EV drivers, because up till now one of the big draws of EVs has been the fact that they're exempt from the cost of vehicle tax. Time will tell.
Why are the Changes Happening?
Simple answer . . . the more drivers switch to EVs, the more money the government loses.
In addition to tax payments, petrol and diesel vehicles provide the government with money in the form of fuel duty – currently 52.95p for every litre. The Treasury estimates that the reduction in income from these sources will cost the government £35 billion per year.
And because more savvy drivers like yourself are switching to EVs, the government aims to limit the financial damage by bringing in these new changes. Imposing tax on electric vehicles is a quick and easy way to make a start on that.
How Much is My Car Tax in 2025?
In a nutshell, the basic 'flat' rate for car tax in 2025 is set to be £190. And if your vehicle had a list price exceeding £40,000 when it was first sold, you may also have to pay the 'premium car tax' fee, which means a further £410 potentially. (More on that in a bit.)
As touched upon, the exact amount you pay will depend upon your vehicle's fuel type (petrol, diesel, electric etc.) AND the date at which it was first registered.
2025 Road Tax Calculator (New VED Rates)
| CO2 emissions | Standard Rate | First Year rate |
|---|---|---|
| 0 g/km | £0 | £0 |
| 1 to 50 g/km | £190 | £10 |
| 51 to 75 g/km | £190 | £30 |
| 76 to 90 g/km | £190 | £135 |
| 91 to 100 g/km | £190 | £175 |
| 101 to 110 g/km | £190 | £195 |
| 111 to 130 g/km | £190 | £220 |
| 131 to 150 g/km | £190 | £270 |
| 151 to 170 g/km | £190 | £680 |
| 171 to 190 g/km | £190 | £1095 |
| 191 to 225 g/km | £190 | £1650 |
| 226 to 255 g/km | £190 | £2340 |
| Over 255 g/km | £190 | £2745 |
What are the New Electric Car Tax Rates?
As the government is effectively removing the £0 Band A category on the existing tax system, vehicles already in this band (electric vehicles) will move to other car tax bands, you can read the full low down on the new electric car tax rates but we've summed it up below.
Electric and low emission cars registered on or after 1 April 2025
New zero-emission (electric) cars registered from 1 April 2025 will incur the lowest first-year rate of VED. That's currently £10 but is likely to rise.
From the second tax payment onwards, these vehicles will pay the standard rate. This is £190 for 2024 but is subject to change for 2025.
Electric and low emission cars registered between 1 April 2017 and 31 March 2025
Again, you'll pay the standard rate. This is £190 for 2024 but is subject to change for 2025.
Electric and low emission cars registered between 1 March 2001 and 31 March 2017
These vehicles will move to the first band that has a VED value. At present, this is £20 for the current tax year but is subject to change for 2025.
Hybrids and alternative fuel vehicles
The annual flat rate is reduced by £10 to £180.
What About Electric Vans?
Drivers of zero emission electric vans will have their own rates for the 25-26 tax year.
Cars Registered Between 1984 and 2001
Cars registered between 1984 and 2001 fall under a separate tax system, with differing rates for cars with engine sizes above or below 1549cc, but these too will be hit by the tax overhaul. The tax bill for drivers in this bracket is set to increase by roughly £10.
According to motoring experts, motorists in the lower power bracket are set to pay £220 in 2025/26, marking a modest £10 increase from the current £210 per year charge.
Meanwhile, historic vehicles produced before 1984 will continue to benefit from tax exemption.
Vehicles produced after 2001 are not taxed based on their size.
What About Petrol & Diesel Vehicles?
Rates for petrol and diesel cars emitting between 1-50 grams of CO2 per kilometre (including hybrids) will rise from £10 to £110 for 2025-26 for the first year.
Similar increases come for cars emitting 51-75g/km of CO2, with costs rising from £30 to £130.
Drivers of vehicles that emit 76g/km of CO2 and above will see costs double. At the time of writing, the lowest rate for this category, which covers emissions between 76-90g/km, is £135, but following the proposed budget plans, this will jump to £270.
Cars with a list price exceeding £40,000 will also be hit with an additional cost. Known as the expensive car supplement, this will be added to the standard rate of VED from the second licence year for a total of 5 years, or 6 years from when the vehicle was first registered. The rate is currently £410, but prepare to see that rise.
Classic Car Tax Exemption
Nothing changing here.
Classic and historic vehicles built and registered before January 8th, 1985 will continue to be exempt from tax.
But the exemption doesn't happen automatically. You'll still need to apply for it and have the necessary paperwork at hand.
How Will the 2025 VED Changes Affect Company Car Drivers?
You'll get off pretty lightly compared to personal drivers when it comes to car tax changes 2025.
If you drive a company car, the Benefit-In-Kind (BIK) rates for cars emitting less than 75g/km of CO2 will only increase by 1% from the next tax year, so the savings you make for driving an electric or plug-in hybrid vehicle will still largely be there.
In comparison, the lowest BiK cost rise on petrol and diesel company cars will be 3% (from 15% to 18%), further adding to the ongoing appeal of electric company vehicles.
How Do I Tax My Electric Car?
Same as before.
You can do it online via the official DVLA website, by post or over the phone.
If going to the post office, you’ll need to take your car’s V5C registration document, plus the MOT and insurance certificates in order to prove that the car is legal.
Luxury/Performance Car Tax Increase
Luxury and performance models with the largest engines will receive the biggest tax increase, with the rate rising by a staggering £2,745 to £5,490 per year.
To be more specific, that's vehicle models which produce more than 255g/km of CO2.
Here's the full list:
| Alfa Romeo Stelvio 2.9 V6 Bi-Turbo | Jeep Wrangler 2.0 GME |
| Audi R8 5.2 FSI V10 | Lamborghini Huracan 5.2 V10 |
| Audi RS6 4.0 TFSI V8 | Lamborghini Urus 4.0 V8 BiTurbo |
| Audi RS7 4.0 TFSI V8 | Lamborghini Revuelto 6.5 V12 |
| Audi RSQ8 4.0 TFSI V8 | Land Rover Defender 90 5.0 P425 V8 |
| Audi S8 4.0 TFSI V8 | Land Rover Defender 110 5.0 P425 V8 |
| Audi SQ7 4.0 TFSI V8 | Lotus Emira 3.5 V6 |
| Audi SQ8 4.0 TFSI V8 | Maserati Levante 3.0 V6 |
| Aston Martin DB12 4.0 V8 | Maserati Levante 3.8 V8 |
| Aston Martin DBX 4.0 V8 | Maserati MC20 3.0 V6 |
| Aston Martin Vantage 4.0 V8 | McLaren GT 4.0T V8 |
| Bentley Bentayga 4.0 V8 | Mercedes-Benz AMG GT 4.0 V8 |
| Bentley Continental 4.0 V8 | Mercedes-Benz G400D |
| Bentley Continental 6.0 W12 | Mercedes-Benz G63 |
| Bentley Flying Spur 4.0 V8 | Mercedes-Benz GLC63 |
| BMW Alpina XB7 4.4 V8 | Mercedes-Benz GLE63 |
| BMW M8 4.4 V8 | Mercedes-Benz GLS63h |
| BMW X5 M 4.4 V8 | Mercedes-Benz SL55 |
| BMW X6 M 4.4 V8 | Porsche 718 Cayman 4.0 GT4 |
| BMW X7 M 4.4 V8 | Porsche 911 3.7T 992 Turbo |
| Chevrolet Corvette Stingray 6.2 V8 | Porsche Cayenne 4.0T V8 |
| Ferrari Purosangue 6.5 V12 | Porsche Macan 2.9T V6 |
| Ferrari Roma 3.8T V8 | Range Rover 4.4 P530 V8 |
| Ford Mustang 5.0 V8 | Range Rover 4.4 P615 V8 |
| Ford Ranger 2.0 TD EcoBlue | Range Rover Sport 4.4P V8 |
| Ford Ranger 3.0 EcoBlue | Rolls-Royce Cullinan 6.75 V12 |
| Ford Ranger 3.0 V6 | Rolls-Royce Ghost 6.75 V12 |
| INEOS Grenadier 3.0P | Toyota Hilux 2.8D |
| Jaguar F-Pace 5.0 P575 V8 | Toyota Land Cruiser 2.8D |
| Volkswagen Amarok 3.0 TDI |
EVs Are Still Worth It
Despite having to pay for tax for the first time as part of car tax changes 2025, the savings to be had with electric vehicles are still considerable. Besides, the tax costs for petrol and diesel cars is going to go up as well.
FAQs
Is my car tax going up in 2025?
The Government is set to increase car tax (vehicle excise duty) for most drivers in the 2025-26 tax year, including by charging electric drivers for road tax for the first time. Also, rates for the most polluting luxury and performance cars are set to increase the most.
How much will my electric car road tax be in 2025?
Drivers of brand new zero-emission electric cars registered from or after April 1st 2025 will have to pay an electric car tax (vehicle excise duty) of £10 to cover them for their first year on the road. Until this date, electric car drivers will continue to be exempt from paying.