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UK Vehicle Tax Rates Set to Double by 2025

2/2/2026

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Summary

Story summary

Chancellor Rachel Reeves announced in the Budget that the UK will adjust Vehicle Excise Duty (VED) rates, effective April 2025.
From April 2025, first-year VED for the Ford Puma will double from £220 to £440, while Range Rover will rise to £5,490, with a further increase to £5,690 anticipated.
EVs remain VED-exempt for now, but the exemption faces petrol and diesel costs, and a 3p-per-mile EV tax will start in 2028.

History

Historical Context

The UK's Vehicle Excise Duty (VED) system has evolved since its introduction in 1888, with significant reforms in 2001 linking tax rates to CO2 emissions. In 2017, a new VED structure was established, imposing higher taxes on high-emission vehicles, with rates reaching £2,000. Upcoming changes in 2025 and 2028 reflect the UK's commitment to sustainable transportation amid rising environmental concerns.

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Story summary

Chancellor Rachel Reeves announced in the Budget that the UK will adjust Vehicle Excise Duty (VED) rates, effective April 2025.
From April 2025, first-year VED for the Ford Puma will double from £220 to £440, while Range Rover will rise to £5,490, with a further increase to £5,690 anticipated.
EVs remain VED-exempt for now, but the exemption faces petrol and diesel costs, and a 3p-per-mile EV tax will start in 2028.

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