Policy Paper. Vehicle Excise Duty.

Who is likely to be affected – Purchasers of cars first registered from 1 April 2017 onwards.

General description of the measure.

This measure reforms Vehicle Excise Duty (VED) for cars first registered from 1 April 2017 onwards.

First Year Rates (FYRs) of VED will vary according to the carbon dioxide (CO2) emissions of the vehicle.

A flat Standard Rate (SR) of £140 will apply in all subsequent years, except for zero-emission cars for which the SR will be £0.

Cars with a list price above £40,000 will attract a supplement of £310 on their SR for the first 5 years in which an SR is paid.

All cars first registered before 1 April 2017 will remain in the current VED system, which will not change.