Drivers of certain vehicles may be paying up to £418 more to use the roads in 2025 due to major car tax changes, according to experts. Vehicle Excise Duty (VED) fees increased for petrol, diesel and electric vehicle owners from April 2025.
The biggest updates affected brand-new petrol and diesel VED charges, with many fees having doubled. The new rules have seen thousands of pounds added to bills in a major blow to owners of highly polluting combustion models. According to previous analysis from TaxNatives, the new rules are predicted to generate an additional £162.9 million in revenues over the first half of 2025.
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Overall, this could see drivers paying an average of £418 more to get behind the wheel of new vehicles.
Andy Wood, spokesperson for TaxNatives said: "Choosing a nearly new or low-emission car could help if you're worried about rising VED rates.
"Cars in lower emissions bands come with lower tax costs, which could save you money in the long run. It’s also a good idea to chat with a financial adviser or tax expert to see how you can manage these costs as part of your overall budget."
However, average increases could be even higher for those securing the keys to highly polluting models.
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Vehicles emitting over 255g/km in CO2 will be charged £5,490 in 2025, up from just £2,745 the year before.
Meanwhile, brand-new models emitting anywhere between 226 and 255g/km will also be heavily affected.
These owners have been forced to splash out a whopping £4,680 to use the roads from April 2025, up from the previous £2,340 fee.
Andy Wood from Tax Natives added: "The rise in Vehicle Excise Duty (VED) rates is part of the government’s plan to cut emissions, but it’s also adding financial pressure on drivers.
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"If you’re buying a new petrol or diesel car – especially a higher-emission model – be prepared for a bigger hit to your wallet. These aren’t small increases; they’re significant costs you’ll need to budget for."
Second-hand cars registered since 2017 will pay the standard VED fees, which have also risen from £190 to £195.
Older vehicles will pay their VED tax fees based on the emissions of their vehicle with the highest fees standing at £760.
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