BUDGET 2008: Big penalties for higher-polluting cars amid sweeping VED changes
12 March 2008
Cars running on modern petrol have a lower list price than diesel equivalents
New cars that emit more than 255g/km will be hit by a £950 first year Vehicle Excise Duty bill from 2010 as part of large-scale changes to VED aimed at driving people towards lower-emitting cars.
At the same time, models under 131g/km will be handed a free first year's road tax, while models between 131-160g/km will be charged at the same banded levels as older vehicles with the same emissions figures.
After the first year, all new models will fall into their respective CO2-influenced VED bands.
But before that, six new VED bands will be introduced next year to make a total of 13, including a new M banding for very high polluters emitting more than 255g/km.
At the moment, the top G band covers everything over 225g/km.
Next year's reforms will also see a reduction for all new and existing cars that emit less than 151g/km, but an increase to £440 on the highest polluters, cars over 255g/km. That rises to £455 in 2010.
In an aside, alternatively fuelled cars such as hybrids and LPG models will find their discount gradually eroded to £15 in 2009/10, £10 in 2010/11 and removed completely in favour of a technology-neutral CO2-based system in 2011.
|VED changes from 2008|
|VED band||CO2 (g/km)||2008/9 (£)||CO2 (g/km) ||2009/10 (£)||2010/11 new car (£)||2010/11 after first year (£)|
|A||-101||0||Up to 100||0||0||0|
|H|| || ||161–170||175||250||180|
|I|| || ||171–180||205||300||210|
|J|| || ||181–200||260||425||270|
|K|| || ||201–225||300||550||310|
|L|| || ||226–255||415||750||430|
|M|| || ||Over 255||440||950||455|