It has been warned that drivers may face a tax increase on their vehicles in 2025, with older vehicles being especially vulnerable. The  government has confirmed that until 2029–2030, zero-emission vehicles will pay the lowest rate, £10.

For 2025–2026, rates for cars with CO2 emissions of 1–50 g/km, including hybrids, will rise to £110. For 2025–2026, rates for cars with CO2 emissions between 51 and 75 g/km, including hybrids, will rise to £130. For 2025–2026, all other rates for vehicles that emit 76 g/km of CO2 or more will double from their existing level.

After 40 years, vehicles manufactured prior to January 1st of each year are exempt from VED. According to road groups, this means that cars manufactured in 1984 are no longer subject to a fee, cars made in 1985 are exempt in 2025, and so on.

However, cars constructed with engine capacity larger than or smaller than 1549cc are priced differently under a different scheme for older vehicles registered during this time. During the 2025–2026 tax year, drivers in the lower engine power group will have to pay an additional £220, which is £10 more than the existing requirement of £210.

Car owners who have slightly more powerful engines will pay 50% more, as prices are expected to increase from £345 to £360. New cars that cost more than £40,000 (including options) are subject to a five-year additional fee of £410, which begins when the vehicle is taxed for the second time.

Parkers.co.uk explained: “You can pay for road tax by Direct Debits taken out of your bank account every month. However, doing so adds to the cost. Pay monthly for 12 months tax and the cost goes up from £190 to £199.50 for a petrol or diesel car registered after 1 April 2017. Costs vary between different cars, which you can read about earlier in this article.”