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April tax rules could mean consumers opting for used cars over new - research

Confused consumer

The new car tax laws are putting drivers off buying new cars.

Forty per cent of drivers in a Confused.com survey say that the new rules would discourage them from purchasing a car with a 2017 plate.

And, while the only way out of paying car tax is to buy a car with zero emissions, under a quarter (23%) of drivers would consider buying an electric vehicle.

Two-fifths remain unconvinced that electric cars are a realistic option.

More than half of drivers (57%) say they would be more inclined to buy a second-hand motor to avoid the charges.

Amanda Stretton, motoring editor at Confused.com, said: “It’s fair to say that drivers are disillusioned with the new rules.

“Over half (55%) think that the tax changes are in place just to make the government money, and over a quarter (29%) believe it’s a move to encourage people to buy electric cars.

“And more than half (57%) think the rules are just imposing yet another unnecessary cost for drivers.”

Only one in 10 drivers understand the new Vehicle Excise Duty (VED) rules, Confused.com found.

And even though there is only a month to go before the laws come into force, eight in 10 drivers do not think the changes have been well-publicised.

According to Confused.com’s research, the average driver currently pays around £102 for their car tax every year.

But the 15% of drivers who are planning to buy a new car in the next six months may now have to pay a much higher emissions-based rate within their first year and up to £140 each year after.

“The new car tax rules are just a series of recent cost hikes to burn a hole in the pockets of Britain’s motorists,” said Stretton.

“In recent months, petrol prices have soared to 120.11 pence per litre and the average car insurance premium has reached £737.

"Not to mention the impending insurance premium tax threatening to rise prices even higher from June."

> Research: all figures taken from omnibus research carried out by One Poll on behalf of Confused.com. This was an online poll of 2,000 UK adults who drive (nationally representative sample). The research was conducted between February 6 and February 8, 2017.

New laws for cars registered from April 1

> The new laws only apply to new 2017-plate cars registered from April 1st.
> The ‘first licence rate’ for vehicle tax remains the same in the first year, and continues to be based on the vehicle’s CO2 emissions.
> After the first year the vehicle will pay one of three standardised rates based on the vehicles fuel type:

  • £140 per year for petrol and diesel vehicles
  • £130 per year for ‘alternative fuel’ vehicles, such as hybrids
  • £0 per year for zero emissions vehicles, such as fully electric
  • Vehicles where the manufacturers list price is over £40,000 will have to pay an additional £310 on top of the standard rate for five years. After this it will be taxed at the standard rate.

How tax for petrol and diesel cars compare before and after April 1 2017

  Pre- April 1 2017 Post-April 1 2017  
Example Current annual First year Standard rate
CO2 emissions tax rate 'licence rate' after the first year
  (based on the vehicle's emissions) (based on the vehicle's emissions) (based on the vehicle's fuel-type)
120g/km £30 £160 £140
150g/km £145 £200 £140
170g/km £210 £500 £140
Over 255g/km £515 £2,000 £140

 

 



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