Taxing Times

Road Fund Licence, Vehicle Excise Duty, tax disc, RFL, VED, road tax, car tax whatever else you call it, there is no escaping the fact that to drive your car legally you will have to buy it and from April 2009 it’s going to be even more expensive, so picking a low emission car could save you a lot of money.

The government has basically introduced a number of new bands to penalise vehicles with high Co2 emissions. Do not be fooled into thinking this will only effect enormous cars and 4x4s. Some very ordinary family cars will see their annual tax disc increase by £100 after April. Now that is nasty in itself, but many industry experts are also predicting that this will affect the resale value of your car as people are less willing to buy a used car that incurs these higher taxes.
New cars don’t get off lightly either. At the moment there is a new vehicle tax or “First Registration Fee”. Currently this is a fixed cost of £55. However, the government has announced that in the 2010 -2011 tax year this fee will be charged based on the Co2 of the car. For the highest banded vehicles this will see the fee rise to nearly £500. Better news is that some vehicles will not incur this fee anymore and in fact will be tax exempt in the first year. So make sure you understand the Co2 of your next planned car.  Think about when you might choose to change and if you don’t know what the Co2 of your car is at the moment, maybe you should find out before April 2009.