Older Motorists Among Millions Facing Higher Car Tax Bills from April
Older drivers are set to be significantly impacted by new Vehicle Excise Duty (VED) increases coming into force from April 1st, with millions of motorists across the UK facing higher annual tax bills for their vehicles. The changes mean that owning and operating a car will become more expensive for a substantial portion of the driving population, particularly affecting those on fixed incomes.
Comprehensive VED Increases Across Vehicle Types
Almost all petrol, diesel, and electric vehicle owners will experience cost rises when the updated VED rates are implemented. Under the new regulations, older drivers receive no special treatment or exemptions based solely on age, being subject to the same increases as every other motorist. The only vehicles qualifying for complete tax exemptions are those used by disabled motorists with qualifying disabilities, alongside classic cars registered more than forty years ago.
This distinction means that while disabled drivers will continue to pay no VED, healthy pensioners and older motorists without qualifying disabilities must budget for the full increased charges. The government has confirmed these changes form part of their annual inflation-linked adjustment process, ensuring vehicle tax rates typically rise each year in line with economic indicators.
Specific Rate Changes and Financial Impact
Standard VED for cars registered after 2017 will increase from £195 to £200 per year. However, drivers purchasing brand new petrol and diesel vehicles face the most substantial financial impact, with first-year VED charges rising by £200 from £5,490 to £5,690. This represents a significant additional cost for those investing in new combustion engine vehicles.
Older vehicles registered before March 1st, 2001 will also see higher annual costs. Cars with engines above 1549cc will increase from £360 to £375 per year, while smaller vehicles with engines below 1549cc will rise from £220 to £230 annually. These increases particularly affect owners of older vehicles who may already be managing tighter budgets.
Electric Vehicle Taxation and Government Rationale
Electric vehicle owners emerge as the least affected group under the new charging structure. Older EVs registered before 2017 will continue paying just £20 per year, while first-year VED for zero-emission vehicles remains at a modest £10 annually. This differential treatment reflects ongoing government incentives to encourage electric vehicle adoption despite broader tax increases.
HMRC confirmed the VED changes following Rachel Reeves' Autumn Budget announcement, stating: "As announced at Budget 2025, the Government will introduce legislation in Finance Bill 2025-26 to uprate Vehicle Excise Duty rates for cars, vans and motorcycles in line with the Retail Price Index (RPI) for 2026 to 2027. This will take effect from April 1, 2026."
Broader Implications for Motorists
The cumulative effect of these increases means millions of drivers, including substantial numbers of older motorists, will need to carefully adjust their household budgets to accommodate higher motoring costs as the new financial year begins. With no age-based exemptions available, pensioners and older drivers must factor these additional expenses into their financial planning, particularly those relying on fixed incomes who may find the increases particularly challenging.
These changes come alongside other motoring cost pressures, creating a perfect storm of increased expenditure for vehicle owners across the country. The government's approach maintains consistency in vehicle taxation while generating additional revenue through inflation-linked adjustments, though at the expense of higher living costs for millions of motorists.
