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Drivers Face £1,732 Average VED Rise as Government Eyes Luxury Car Surcharge Threshold

Go Compare analysis found van owners paid £15.5 million more in the first half of 2025/26, prompting ministers to consider raising the £40,000 surcharge cap

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Overview

  • The April reforms now set first-year VED at £110 for vehicles emitting 1–50 g/km CO₂ and £135 for those at 51–75 g/km, up from £10–£30.
  • Go Compare calculates van drivers have paid an extra £1,732 per vehicle, totalling £15.5 million in additional tax since April.
  • Petrol vans generated £1.2 million in new revenue with owners paying an extra £1,354 on average, while diesel models faced even higher charges.
  • Electric van owners incur only a £10 annual rise and hybrids just £252 more, strengthening incentives to shift to cleaner fleets.
  • Lawmakers are reviewing the £40,000 Expensive Car Supplement cap following criticism that it penalises mid-range electric vehicle buyers.