Petrol and diesel car owners are now paying more due to new car tax rules that started in April 2026. HM Revenue and Customs has raised Vehicle Excise Duty rates to match inflation & this means higher costs for most drivers.
The updated VED rates began on April 15 2026. For cars registered after 2017 the standard yearly tax went up from £195 to £200.
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First-year tax rates saw the largest increases. Buyers of new cars with high emissions must now pay £5690 instead of the previous £5,490. Cars that emit between 226 & 255 grams per kilometer of CO2 also face bigger charges as the rate climbed from £4,680 to £4,850.
Cars registered between 2001 & 2017 face higher taxes too with increases across several bands. Vehicles emitting more than 255 grams per kilometer of CO2 now pay £790 each year compared to £760 before. Cars in the 225 to 255 grams per kilometer range will pay £760 rather than the earlier £735.
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Tax bands H and I went up by £15 while bands G and F increased by £10. Bands C and D saw a smaller rise of £5 but the lowest emission categories in bands A and B remained unchanged. HMRC sets the VED rules while the DVLA collects the payments and enforces the regulations. The government announced these changes in December 2025 to give car owners time to get ready.
These updates were confirmed after the Autumn Budget 2025 which stated that VED rates for 2026 to 2027 would be adjusted based on the Retail Price Index starting from April 15 2026.
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