In a significant move for emergency services, Chancellor Rachel Reeves has unveiled reforms to motoring taxes that will grant specific vehicle types exemption from Vehicle Excise Duty (VED).
New Exemptions for Critical Services
The Government has confirmed it will exempt search and rescue vehicles from car tax. This change, announced by Labour Party Chancellor Rachel Reeves, follows campaigning from backbench MPs and is scheduled to take effect from April 2027.
Ms Reeves publicly thanked two Labour MPs for their pivotal support in pushing for these tax exemptions: Torcuil Crichton, the MP for Na h-Eileanan an Iar (formerly Western Isles) in Scotland, and Josh MacAlister, the MP for Whitehaven and Workington.
Impact on Search and Rescue Teams
The financial relief for these vital volunteer organisations is expected to be substantial. Josh MacAlister hailed the announcement as a "campaign success", revealing that it would save his own local mountain rescue team approximately £2,000 per year.
He emphasised that because these search and rescue organisations rely entirely on public donations, the exemption will make a significant difference. "That will make a big difference in lifting the burden on fundraising off some of those teams," MacAlister stated. "[It means] they can focus on the job they do so well, which is making sure they keep the public safe."
Broader Motoring Tax Context
This exemption for search and rescue vehicles comes alongside other motoring tax developments. The government has frozen fuel duty on petrol and diesel until at least September. However, the announcement of a new pay-per-mile car tax for electric vehicles (EVs) has raised concerns for some drivers.
One EV driver told the Guardian she faces paying an extra £300 to £600 annually. This is compounded by the 20% VAT rate remaining on electricity from public chargers, whereas home charging benefits from a reduced 5% VAT rate.
The Chancellor's office has stated it will work with stakeholders to "design and implement an exemption" for search and rescue vehicles, marking a targeted relief for essential, donation-funded public services.
