Does anybody understand this new TAX regime? I have just been reading the Daily Mail article today and I am none the wiser.
I am sure the author has made a valiant attempt to explain (why not) but it has now become painfully difficult to know how much we need to pay for our cars.
Remember the good old days before global warning (what’s that anyway?) We all knew how much it was (remember how we complained that no other country had this tax.) Guess what!
We never knew how well off we were.
Show room taxes, (up to £1000) back-dated taxes for cars between 2001-2006
Road tax is paid on a sliding scale of 13 bands – from A to M – based on the level of emissions of carbon dioxide, the so- called ‘greenhouse gas’ blamed for global warming.
The winners will be existing drivers of big gas-guzzling cars – who will pay less than they would have under the original plan. Those in the highest ‘gas-guzzling’ band could be up to £35 better off – paying £405 instead of the planned £440.
Ironically for a ‘green tax’, among the losers will be drivers of some of the most environmentally-friendly cars who will end up paying more than they would have done before the Chancellor’s changes.
Those in Band B (101-110g/km CO2) such as the Mini Diesel and Toyota Prius and Volkswagen Polo Blue Motion, will pay £35 tax in 2009 instead of the planned £20 – making them £15 worse off.
From April next year, there will, as planned, be six new VED bands taking the total to 13. But rates will not increase from what they are now by more than £5 for any car in 2009.
From April 2010, the rates in each of the 13 bands will change again for existing cars. But there will also be a separate ‘first-year rate’ for new vehicles – starting at zero for the cleanest cars up to £750 and £950 for the highest polluters.
In the original proposal, some cars would have seen increases of up to £90. But now the increase for the more polluting vehicles will be up to a maximum of £30.
And less polluting cars will see no increase or a cut of up £30.
Also, cars which emit more than 225g of carbon dioxide per kilometre, but were registered between March 1 2001 and March 23 2006, will be moved into the new VED band K in 2009 and stay there in 2010. This will mean that they maintain their exemption from the top rate of VED.
Now we can see how complicated this all is? Is it really necessary? The question on buying cars used to be insurance, colour, service history, bumps, scrapes etc.
Now it’s “what is the road tax band?”