New car tax bands for 2025 in full with drivers facing £5,490 in VED

Chancellor Rachel Reeves has announced changes to the tax bands for brand new cars from April 2025 onwards. The changes will only affect the cost of VED for the first year the car is registered, but there are some substantial rises.

All cars emitting between 1-50 g/km of CO2 (which includes most plug-in hybrids) will see the first year tax bill rise to £110. Currently hybrids in this band pay zero VED in the first year, while petrol and diesel cars pay £10, the bands show.

New cars emitting between 51-75g/km of CO2 will increase from £30 (or £20 for hybrids) to £135. Yet the biggest sting will be for buyers of the most polluting vehicles. Any petrol or diesel car with emissions of 191-225g/km CO2 will be upped to £3,300 (from £1,650) for the first year.

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This would include a new mild-hybrid diesel Range Rover, which has claimed CO2 emissions of 194g/km. The initial VED costs for a brand new vehicle putting out 226-255g/km CO2 will be hiked to £4,680 (from £2,340), the- Labour Party government's Budget documents show.

And the biggest increase will be for motorists purchasing new petrol and diesel cars with CO2 emissions in excess of 255g/km, which for the first year only will cost a staggering £5,490 (up from £2,745), the Budget documents go on to stipulate.

Paul Barker, editor at car magazine Auto Express, said: "Doubling first-year VED rates for anything over 76g/km alongside big hikes for non-EVs below that adds a notable cost, especially for high-polluting cars over 255g/km that will now cost almost £5,500 in first-year VED alone."

Nicholas Lyes, IAM RoadSmart director of policy and standards, said that increasing VED on all but zero emission vehicles in the first year will 'hit those buying new conventional vehicles in the pocket'.