Drivers have been given a full list of changes due to take place from the beginning of April 2025 as the DVLA makes sweeping reforms to how much tax motorists pay.
While the Spring Budget contained very little to affect motorists across the UK, many drivers are expecting higher motoring costs just days after Chancellor Rachel Reeves’ statement.
According to the repair price comparison service Garage.co.uk, one of the most significant changes will be the end of the tax exemption for electric models, including new car buyers.
They explained: “One of the main adjustments is the introduction of a £10 first-year VED rate for zero-emission vehicles (EVs).
“While £10 may seem small, this change signals the end of tax-free incentives that have long encouraged EV adoption. Likewise, zero-emission vehicles will be subject to the standard VED rates after the first year, likely increasing over time.”
In addition to the £10 fee charged to new car buyers, current owners of an electric model will also be subject to paying for their road tax from April 1, 2025.
For most motorists who own an electric vehicle that was first registered after March 2017, their annual tax bill will be £195 per year – the same amount that petrol and diesel car drivers are currently charged.
However, if a driver buys an EV with a retail price of more than £40,000 after the tax changes take place, they will also be subject to the expensive car supplement – an additional £425 fee charged from the second to sixth year the vehicle is on the roads.
However, the DVLA’s changes will not just affect electric car owners, with Garage.co.uk also highlighting that the tax on new hybrid vehicles will also rise by £100.
They added: “Starting this spring, low-emission vehicles, including hybrids, which emit between 1 and 50 grams of CO₂ per kilometre, will face a first-year VED rate of £110. This is a huge shift from the previous tax regime that incentivised the purchase of hybrid vehicles through lower VED rates.
“Hybrids have traditionally been seen as a practical middle ground for drivers who are not yet ready to fully transition to electric vehicles. However, with the higher initial cost in VED, hybrid vehicles may become less appealing, which could slow down the transition to cleaner vehicles. This could also discourage budget-conscious buyers from choosing a hybrid, potentially leading them to stick with traditional diesel and petrol cars.”
Finally, the changes made by the DVLA could result in the cost of new petrol and diesel models rising considerably, with the tax paid on many models doubling.
A change made in order to encourage new car buyers to choose an environmentally friendly new car, the amount of tax charged on a small petrol supermini, such as a Vauxhall Corsa or Dacia Sandero, will increase from £220 to £440.
However, the models that are set to be worst affected by the change will be those producing more than 255g/km of carbon dioxide, such as high-performance supercars and luxury SUVs, which are set to come with a hefty £5,490 tax bill after the change.
