DVLA Implements Significant Changes, Impacting Vehicle Owners' Costs

The Driver and Vehicle Licensing Agency (DVLA) has implemented increased road tax charges for a large number of drivers this month, with several changes taking effect on April 1st. These adjustments encompass an increase in the standard rate applicable to all vehicles. Furthermore, the tax exemption previously granted to electric vehicles (EVs) has been eliminated.

In addition to these changes, vehicles with low emissions are also subject to tax increases. There has also been a significant rise in first-year rates for new cars that produce high emissions. This means that drivers could experience a substantial increase in the overall cost of operating their vehicles. The AA has cautioned that the average car owner in the UK could potentially spend over £650 annually on fuel duty and road tax.

The new standard annual road tax rate has increased by £5, now totaling £195. This rate applies to all cars first registered between April 1, 2017, and March 31, 2025, including electric vehicles. New EVs registered from April 1st will be subject to a £10 tax in their first year, often referred to as the "showroom tax." Additionally, an "expensive car supplement" will be applied to cars with a list price exceeding £40,000. These vehicles will incur an extra £425 annually between the second and sixth years of ownership. However, EVs registered before March 31, 2017, will benefit from a lower annual rate of £20.

The changes also affect low-emission vehicles. Those producing between one and 50 g/km of CO2 are now subject to a £110 tax rate, whereas previously, they were exempt in the first year. First-year road tax for new cars emitting 51-75 g/km has increased to £135. Meanwhile, the rate for new cars in the higher-polluting category (emitting 76g/km or more) has doubled. Owners of new luxury and performance cars purchased after April 2025 that emit over 255g/km of CO2 will face the most significant impact, with road tax rising to £5,490 per year. However, pickups are being treated as light commercial vehicles (LCVs) and will not be subject to this tax increase.