Almost nine in 10 drivers have admitted they don’t understand changes to car tax that are set to be introduced next month.
The new Vehicle and Excise Duty rules will see buyers of diesel cars from April 1 having to pay up to £500 more to tax a vehicle for the first year.
However, 87 per cent of drivers recently surveyed said they didn’t understand the changes or were completely unaware that tax would increase for new diesel vehicles from April.
New VED rules proving too taxing for drivers: Almost 9 in 10 motorists have said they don’t understand hikes in first year car tax for new diesel vehicles that will be introduced next month
The new law, which only applies to newly-registered diesel cars bought from April, pushes all 17-plate diesel vehicles one tax band higher in a bid by ministers to deter motorists from buying the fuel type.
Many new diesels will only be taxed £20 more than before, however some larger models will become significantly more expensive to tax for the first year.
Even the most efficient diesel model on the market – the Peugeot 208 1.6-litre BlueHDI Active 75 – producing as little as 78g/km CO2 will be affected by the law, despite being the cleanest non-hybrid or electric vehicle you can buy today.
However, some premium SUVs that produce between 191 and 225g/km CO2, like the Mercedes-Benz GLE 350d AMG 4Matic and Range Rover 4.4 SDV8, will see first-year VED rates soar from £1,500 to £2,000 next month.
And it’s not just flashy 4x4s that will feel the most significant impact.
Affordable models aimed at big families, such as Hyundai’s £26,000 eight-seat i800 MPV and Ssangyong’s £28,000 seven-seat Rexton SUV, also fall into the worst-hit tax bracket, with all new models in this band costing £500 more to tax from next month.
The Peugeot 208 1.6-litre BlueHDI Active 75 is the lowest CO2 emitting new petrol or diesel car you can buy, but buyers will have to pay £20 extra to tax it
If you buy a new diesel car from April 2018, you will have to pay the first-year VED band (second column) one band higher than stated in this table. For instance, a car with 91-100g/km CO2 emissions would have to pay £140 in the first year
HOW MUCH WILL A NEW DIESEL CAR COST TO TAX IN THE FIRST YEAR FROM APRIL?
76-90g/km CO2: £120 – up £20
91-100g/km CO2: £140 – up £20
101-110g/km CO2: £160 – up £20
111-130g/km CO2: £200 – up £40
131-150g/km C02: £500 – up £300
151-170g/km CO2: £800 – up £300
171-190g/km CO2: £1,200 – up £400
191-225g/km CO2: £1,700 – up £500
226-255g/km CO2: £2,000 – up £300
And it won’t just be those heading into showrooms in a few weeks’ time that will be punished by new tax rules.
All drivers who bought a new car last April will be the first to feel the effects of tax rules enforced by the government 12 months ago, which increased the cost of standard-rate tax for most drivers.
Standard rate VED – which is the amount of tax you pay from the second year on – was changed from being based on how much the vehicle emitted to a flat rate fee of £140 for all new models bar zero-emissions electric cars.
Those who bought new cars from April 2017 with a value of more than £40,000 will also be stung by a new premium tax of £310, too, which will need to be paid from this year and the following four years on top of the standard rate.
The VED hike for diesel will see affordable vehicles aimed at large families – such as the 8-seater Hyundai i800 pictured – become £500 more expensive to tax in the first year
And from 2020, the Government said it will impose a third change to VED tax rates in four years, with bands being adjusted to comply with a new fuel economy test measuring emissions outputs that manufacturers have had to use since September last year.
Unsurprisingly, the volume and complexity of tax changes have left motorists baffled.
8 NEW CARS THAT WILL COST £500 MORE TO TAX
1. Bentley Bentayga (4.0 V8 Mulliner Auto)
2. Hyundai i800 (2.5 CRDi SE 136PS)
3. Land Rover Range Rover (4.4 SDV8 Vogue 339hp Auto)
4. Land Rover Range Rover Sport (2.0 Si4 HSE 300hp Auto)
5. Mercedes-Benz GLE-Class (GLE 350 d AMG Night Edition 4MATIC 9-speed G-Tronic)
6. Mercedes-Benz GLS-Class (GLS 350 d AMG Line 4MATIC 9-speed G-Tronic)
7. Porsche Cayenne (4.2 S Diesel Tiptronic S)
8. Ssangyong Rexton (2.2 EX 180PS)
Many of the cars affected by the biggest jump in first year tax are luxury SUVs, like the Range Rover (left). The Mercedes-Benz GLS (right) will also be heavily impacted
When comparison site Confused.com surveyed a panel of 2,000 drivers, almost nine in 10 said they were struggling to grasp by the changes due to be enforced from next month.
Some of those were even unaware that first-year VED costs would be higher from April.
For those in the know, it seems the hikes will have an impact on the next new car they purchase.
Three in five said they wouldn’t buy a new diesel next, with a third directly attributing the decision to increases in tax.
Almost half (46 per cent) also thought the recent messaging around diesel had been unclear, causing uncertainty and reluctance to purchase a new model.
Amanda Stretton, motoring editor at Confused.com, said motorists haven’t seen the last of surcharges on diesel and should expect more taxation for the under-fire fuel type as the government gears up for restrictions on the sale of new vehicles powered solely by petrol and diesel engines.
‘Drivers are clearly confused about the messaging around diesel vehicles. It’s no wonder motorists are not up to speed with the latest laws,’ she said.
‘As we head towards 2040, when the sale of new diesel and petrol vehicles will be banned, we expect drivers will see numerous incentives and penalties being introduced.
‘Whether such measures will encourage take up of more environmentally friendly car-types remains to be seen.’