Starting April 1st 2025, drivers up and down the UK will face a car tax hike.

However, not all cars face a vehicle tax rise—the government only focuses on high-emission vehicles and older cars. 

This comes as part of the changes to Vehicle Excise Duty (VED), to encourage the adoption of low-emission and electric vehicles by making high-polluting cars more expensive to own.

Will you be affected by the older car tax increase? We’ll explain everything you need to know below.

Changes to VED taxes from April 1st 2025

The tax increase comes with Vehicle Excise Duty (VED) changes, also known as road tax. If you drive or keep a car on the road, you must pay this tax as an annual fee.

From April 1st, 2025, there will be changes to VED tax for petrol and diesel vehicles. A vehicle's CO₂ emissions primarily determine the amount payable. Basically, the higher the emissions, the higher the tax.

Following the new regulations, the first-year VED of vehicles emitting over 255g/km of CO₂ will double from £2,745 to £5,490. But of course, your tax payment will depend on your specific car.

So, find out if your car is facing a tax rise and add these costs to your budget! 

What’s causing the car tax hike in April?

Taxes are going up. But why?

This increase is part of a broader strategy to promote environmental sustainability by discouraging using high-emission vehicles. 

The government projects that this measure will raise approximately £400 million in the coming year, with expectations to reach £1.7 billion by the decade's end. 

Additionally, the policy aims to accelerate the transition to greener transportation options (e.g., electric and public transport), reducing carbon footprints and improving air quality. 

It's all about being sustainable and building a better future!

What cars are affected by the tax increase (VED)?

59 cars will be affected by the VED tax increase in 2025. 

These are mainly luxury and high-performance cars that are more polluting than new, greener alternatives. For example, cars with powerful engines and potent emissions will have the steepest tax hikes. 

Here’s a list of all cars facing vehicle tax rise:

• Alfa Romeo Stelvio Quadrifoglio (2.9-litre V6 petrol)
• Alpina B8 (4.4-litre V8 petrol)
• Alpina XB7 (4.4-litre V8 petrol)
• Aston Martin DBX (4.0-litre V8 petrol)
• Aston Martin Vantage (4.0-litre V8 petrol)
• Aston Martin DB12 (4.0-litre V8 petrol)
• Audi SQ7 (4.0-litre V8 petrol)
• Audi RS Q7 (4.0-litre V8 petrol)
• Audi SQ8 (4.0-litre V8 petrol)
• Audi RS Q8 (4.0-litre V8 petrol)
• Audi RS 6 Avant (4.0-litre V8 petrol)
• Audi RS 7 (4.0-litre V8 petrol)
• Audi S8 (4.0-litre V8 petrol)
• Bentley Bentayga (4.0-litre V8 petrol)
• Bentley Flying Spur (4.0-litre V8 petrol)
• BMW 8 Series Gran Coupe (4.4-litre V8 petrol)
• BMW 8 Series  (4.4-litre V8 petrol)
• BMW X5 (4.4-litre V8 petrol)
• BMW X6 (4.4-litre V8 petrol)
• BMW X7 (4.4-litre V8 petrol)
• Chevrolet Corvette (6.2-litre V8 petrol)
• Jeep Wrangler (2.0-litre four-cylinder petrol)
• Ferrari Purosangue (6.5-litre V12 petrol)
• Ford Ranger (2.0-litre four-cylinder diesel, 3.0-litre V6 diesel & 3.0-litre V6 petrol)
• Ford Mustang (5.0-litre V8 petrol)
• Ineos Grenadier (3.0-litre petrol & 3.0-litre diesel)
• Ineos Quartermaster (3.0-litre petrol & 3.0-litre diesel)
• Lamborghini Revuelto  (6.5-litre V12 petrol)
• Lamborghini Urus (4.0-litre V8 petrol)
• Land Rover Defender (5.0-litre V8 petrol & 4.4-litre V8 petrol)
• Land Rover Range Rover Sport (4.4-litre V8 petrol)
• Land Rover Range Rover (4.4-litre V8 petrol)
• Lotus Emira (3.5-litre V6 petrol)
• McLaren 750S  (4.0-litre V8 petrol)
• McLaren GTS (4.0-litre V8 petrol)
• Maserati Levante (3.0-litre V6 petrol)
• Maserati MC20 (3.0-litre V6 petrol)
• Mercedes G-Class (3.0-litre six-cylinder petrol & 4.0-litre V8 petrol)
• Mercedes S-Class (6.0-litre V12 petrol)
• Mercedes GLS (4.0-litre V8 petrol)
• Mercedes GLE (4.0-litre V8 petrol)
• Mercedes GLE Coupe (4.0-litre V8 petrol)
• Mercedes SL (4.0-litre V8 petrol)
• Mercedes-AMG GT (4.0-litre V8 petrol)
• Mercedes-AMG GT 4-Door (4.0-litre V8 petrol)
• Porsche Panamera (4.0-litre V8 petrol)
• Porsche Macan (3.0-litre V6 petrol)
• Porsche Cayenne (4.0-litre V8 petrol)
• Porsche Cayenne Coupe (4.0-litre V8 petrol)
• Porsche 911 (3.7-litre six-cylinder petrol & 4.0-litre six-cylinder petrol)
• Rolls Royce Cullinan (6.75-litre V12 petrol)
• Rolls Royce Phantom (6.75-litre V12 petrol)
• Rolls Royce Ghost (6.75-litre V12 petrol)
• Toyota Land Cruiser (2.8-litre four-cylinder diesel)
• Toyota Hilux (2.8-litre four-cylinder diesel)
• Volkswagen Amarok (3.0-litre V6 diesel)

How the car tax increase will affect electric vehicles

While the higher tax rates apply to more polluting cars, the new VED structure also introduces changes for electric vehicle owners. 

From April 1st, EVs will no longer be exempt from road tax.

All EVs will be subject to a standard VED, starting at £10 in the first year and £195 annually thereafter. Additionally, EVs with a list price over £40,000 will incur an extra £425 annually for five years, beginning from the second year of ownership. 

These changes are expected to affect approximately 70% of new EVs, potentially influencing new and second-hand markets. Something to consider if you’re looking for a new car. 

Learn more about the VED tax impacts on electric vehicles here.

Final thoughts

The upcoming VED changes mark an exciting step toward a greener future for the UK's roads. 

Whether you already own a car or are thinking about buying one, it's a great time to explore how these updates can fit into your financial plans and eco-friendly choices.

Read more about the UK roads via the Bumper blog.

How Bumper can help

Higher road tax isn’t the only extra cost that comes with owning a car!

With Bumper, you can split the cost of repairs into monthly payments at no extra cost. 

Apply online for up to £5,000 and choose from 1,000s of trusted repairers.