The New Car Tax Rules

The price of an annual car tax disc is now based on how much carbon dioxide (CO2) a car emits and what fuel it uses. The old system of car road tax, which was based only on engine size, was changed to encourage drivers out of gas-guzzling, high-emissions older cars and into newer, smaller-engined ones.

Fueling debate

The Government hopes that the CO2-based system will encourage the purchase of more fuel-efficient vehicles and those emitting less carbon dioxide (CO2 output is proportionate to the amount of fuel burned), and also to get drivers to use more environmentally-friendly fuels.

How is it worked out?

There are six CO2 grades. No new cars on sale currently meet the criteria for the lowest Band A (emitting up to 100g/km) bar special-order electric models, but a number of small city cars, and larger hybrids such as the Honda Civic IMA and Prius, qualify for Band B (101-120g/km). Inside these six bands, there are additional penalties or incentives based on the type of fuel used: alternative fuels get a part-rebate, while diesel fuels are penalised for their increased particulate emissions. Breakdown of rates :
 

Bands CO2 rating
(g/km)
Diesel
12 month
Petrol
12 month
Alternative fuel
12 month
Band A Up to 100 £75 £65 £55
Band B 101-120 £85 £75 £65
Band C 121-150 £115 £105 £95
Band D 151-165 £135 £125 £115
Band E 166-185 £160 £150 £140
Band F Over 185 £170 £165 £160

Older cars

If your car was registered before 1st March 2001, then the Vehicle Excise Duty you have to pay is based on your engine size: £110 for 12 months on vehicles up to 1549cc and £165 for those over 1549cc
 

Further Reading

  • Car Hire

    All you need to know about car hire from getting the best online deals to insurance. Check out our guide now.
  • Secured Loans Explained

    Ever wondered about the difference between secured loans and unsecured loans?
  • Your Maternity Rights Explained

    Find out more about your Statutory maternity pay rights in the simplest form With our guides we have explained in simple terms the real basics so you have some idea of what you're due!
  • Data Recovery Explained

    Find out more about data recovery software as if it's explained right - it could save your hard drive and your work. Check out our simple guide for the basic facts!
  • Instant Messaging Explained

    To really keep in touch, Instant messaging & chat room software can make all the difference. Talk to mates or business colleagues - it's easy!

Featured

Directory

  • Add Your Website
    Add your site to our guides and get more traffic that's relevant for you!

Site Search  Product Search


Feature

Register for updates