Nov 17th Budget - Tax impact for EVs

[Lovemyev]

By vehicle you mean car?

Here you go !.

 

[4ND]

be interested to see the detail on that - will it only apply to vehicles purchased from 2025? It will surely be lower than ICE cars?

My guess, who cares but for what it's worth, is it won't be for prior purchased cars (you can still get £0 VED on some glorious diesels we were once so encouraged to buy, just like electrics are now), but I reckon it will be the same as the lower rate petrol car price (currently £165). They got to make up the revenue loss from somewhere.

 

[Andy66]

Probably the lowest car tax band, same as our current Hybrid car.

 

[Silver estate]

Well still free till April 2025

 

[vini]

Hang on - April 2025?
There will be a general election before then won’t there?

He can promise anything for 2025 and it doesn’t really matter that much

At least it makes clear that for now it starts at zero

 

[siteguru]

The devil will be in the detail.

 

[Silver estate]

Hang on - April 2025?
There will be a general election before then won’t there?

He can promise anything for 2025 and it doesn’t really matter that much

At least it makes clear that for now it starts at zero

Do you think they’ll still be in next year ?

 

[Ian Key]

be interested to see the detail on that - will it only apply to vehicles purchased from 2025? It will surely be lower than ICE cars?

It will apply to all EVs even those purchased second hand, not just new ones purchased in 2025

 

[dave99]

here is the detail... £165/year

The government will legislate for this measure in Autumn Finance Bill 2022. This means:
• new zero emission cars registered on or after 1 April 2025 will be liable to pay the lowest first year rate of VED (which applies to vehicles with CO2 emissions 1 to 50g/km) currently £10 a year. From the second year of registration onwards, they will move to the standard rate, currently £165 a year
• zero emission cars first registered between 1 April 2017 and 31 March 2025 will also pay the standard rate
• the Expensive Car Supplement exemption for electric vehicles is due to end in 2025. New zero emission cars registered on or after 1 April 2025 will therefore be liable for the expensive car supplement. The Expensive Car Supplement currently applies to cars with a list price exceeding £40,000 for 5 years
• zero and low emission cars first registered between 1 March 2001 and 30 March 2017 currently in Band A will move to the Band B rate, currently £20 a year
• zero emission vans will move to the rate for petrol and diesel light goods vehicles, currently £290 a year for most vans
• zero emission motorcycles and tricycles will move to the rate for the smallest engine size, currently £22 a year
• rates for Alternative Fuel Vehicles and hybrids will also be equalised

 

[colsky]

So £165 pa for an EV, the same as for a petrol car. I understand the need to have a charge, but I thought it would be set lower than for a petrol car!

 

[mg4karlak]

Any mention of EV BIK, Benfit in Kind. The amount of people that have jumped out of their £50k BMW and Merc gas guzzling company vehicles into the Audi and Tesla type EV's are paying a fraction of the company car tax they used to.
Surely, if he is hitting private EV's like this, he should also go for the "cheap" company cars ?

 

[Ian Key]

So £165 pa for an EV, the same as for a petrol car. I understand the need to have a charge, but I thought it would be set lower than for a petrol car!

I agree. That makes it more than hybrids. They get £10 discount so I expect EVs should get something similar if not more

 

[dave99]

Any mention of EV BIK, Benfit in Kind. The amount of people that have jumped out of their £50k BMW and Merc gas guzzling company vehicles into the Audi and Tesla type EV's are paying a fraction of the company car tax they used to.
Surely, if he is hitting private EV's like this, he should also go for the "cheap" company cars ?

5.35
Company Car Tax (CCT) Rates - The government is setting rates for Company Car Tax until April 2028 to provide long term certainty for taxpayers and industry in Autumn Finance Bill 2022. Rates will continue to incentivise the take up of electric vehicles:
•
appropriate percentages for electric and ultra-low emission cars emitting less than 75g of CO2 per kilometre will increase by 1 percentage point in 2025-26; a further 1% in 2026-27 and a further 1% in 2027-28 up to a maximum appropriate percentage of 5% for electric cars and 21% for ultra-low emission cars
•
rates for all other vehicles bands will be increased by 1 percentage point for 2025-26 up to a maximum appropriate percentage of 37% and will then be fixed in 2026-27 and 2027-28

 

[Nicko]

Bring back the raving looney party lol

 

[Goldie007]

knowing this lot they will put it on a sliding scale of how big the battery is or just grasp a figure out of thin air.
The whole shambles of a road tax pay structure will change when the wind blows in a different direction. It is making me think more about to just cancel my order of the MG4. Not any cheaper to run than my clio that it is going to replace.

 

[dave99]

I agree. That makes it more than hybrids.

yeah, I'm not sure how you can put EV rates up (going back to cars registered 5 years ago!) and keep other rates lower? I'm still paying £30 for my diesel, surely that wont still be £30 come 2025??

 

[McPhee]

Goes a lot further than I thought it would. Really surprised about the change for pre-2017 cars. That's going to raise a pittance and brings up a weird existential question about why, under a system which uses tailpipe emissions to determine the applicable rate, a vehicle which emits nothing receives the same classification as one which emits up to 110g/km CO2.

Are they applying the new 2001-2017 policy to petrol and diesel vehicles which emit <100g/km CO2 as well? Or are EVs set to be rated higher than vehicles with actual tailpipe emissions?

 

[MrAshieB]

Starting to have second thoughts about our MG4 order now too. We currently pay £20 a year for our dirty diesel 2015 Focus.

Will be paying £145 more a year with the MG4 from 2025, by the sounds of things. I guess they won’t be getting my growth into the automobile industry.

How is a dirty diesel cheaper to keep than an EV…? Madness.

 

[dave99]

Starting to have second thoughts about our MG4 order now too. We currently pay £20 a year for our dirty diesel 2015 Focus.

Will be paying £145 more a year with the MG4 from 2025, by the sounds of things. I guess they won’t be getting my growth into the automobile industry.

How is a dirty diesel cheaper to keep than an EV…? Madness.

as others have mentioned though, the tories will hopefully be gone before this change comes into effect, although it will be legislated for and will be the default position unless labour actively come in and change it.

 

[Lovemyev]

Total shambles !.
If they intended to apply VED to electric cars FROM 2025 then that would be bad enough in itself !.
But I am still really struggling to get my head around, how they have a system of grading the cost of your VED against, set against the volume of co/2 emissions that your car produces, which I do agree with.
Then suddenly announce a “ball park” figure of £165.00 to totally ZERO emission BEV’s that will have a higher VED cost over some ICE cars and even some PHEV’s !.
You either replace the whole emission rating scheme with something else, or I feel another “back track” statement on the crazy application on its way !.
You just CAN’T apply an increase in VED to zero emission cars and STILL have a rating system in place that is based purely on co/2 emissions !.
It’s a completely in direct conflict of how we currently set the VED rates in the U.K.