The VED System: A Brief Overview
The Vehicle Excise Duty (VED) system is a tax levied on vehicles in the United Kingdom. It is also known as road tax. The system is used to fund the maintenance and upkeep of the country’s roads. The VED system is based on the vehicle’s emissions and is divided into three bands: A, B, and C. The bands are determined by the vehicle’s CO2 emissions per 100 miles.
How the VED System Works
Electric vehicles set to boost UK tax revenue by £162.9 million in 2025.
The Impact of Electric Vehicles on the UK’s Tax System
The UK’s tax system is set to undergo significant changes with the increasing adoption of electric vehicles (EVs). According to a recent analysis by TaxNatives, the shift towards EVs could generate an additional £162.9 million in tax revenue in just the first half of 2025. This could have a substantial impact on drivers, with the average cost of new vehicles increasing by £418.
The Rise of Electric Vehicles
The UK has been actively promoting the adoption of EVs, with the government setting ambitious targets to reduce greenhouse gas emissions and increase the number of EVs on the road. As a result, the number of EVs on the road has been growing rapidly, with over 1 million EVs registered in the UK as of 2022. Key statistics: + Over 1 million EVs registered in the UK as of 2022 + EVs account for around 5% of new car sales in the UK + The UK government aims to ban new petrol and diesel car sales by 2030
The Impact on Tax Revenue
The analysis by TaxNatives suggests that the increasing adoption of EVs could generate an additional £162.9 million in tax revenue in just the first half of 2025.
The Impact of the New CO2 Emissions Charge
The UK government has introduced a new charge on cars emitting over 255 g/km of CO2, with the aim of reducing greenhouse gas emissions and mitigating the effects of climate change. The charge, which will come into effect in April 2022, will see drivers of cars emitting over this threshold facing a fee to use the roads.
How the Charge Will Work
The charge will be based on the car’s CO2 emissions, with the amount of the fee increasing as the emissions increase. The fee will be calculated using a formula that takes into account the car’s emissions, the number of drivers, and the vehicle’s age. The charge will be payable by the car’s owner, and will be collected by the Driver and Vehicle Licensing Agency (DVLA). The charge will be £5,490 for cars emitting over 255 g/km of CO2. Diesel car owners will be most affected, with an average increase of £1,113.
If you can’t purchase a suitable hybrid or EV, consider opting for a nearly new vehicle.
The Benefits of Buying a Nearly New Vehicle**
If you’re in the market for a new set of wheels, but can’t quite justify the cost of a brand-new vehicle, you’re not alone. Many people face the dilemma of whether to splurge on a shiny new car or opt for a nearly new one. In this article, we’ll explore the benefits of buying a nearly new vehicle, and why it might just be the smartest decision you can make.
Cost Savings**
One of the most significant advantages of buying a nearly new vehicle is the cost savings. When you purchase a nearly new car, you’re essentially buying a vehicle that’s been driven for a short period of time, typically less than 1,000 miles. This means you can get a high-quality vehicle at a significantly lower price point than buying brand new. Lower Purchase Price: Nearly new vehicles are often priced lower than brand-new vehicles, with savings ranging from 10% to 20% or more. Lower Depreciation: Since the vehicle has already taken its biggest depreciation hit, you can expect to retain more of its value over time.