Labour's Upcoming Car Tax Reforms to Impose Hefty £790 Annual Charge
Under the Labour Party's administration, significant changes to petrol and diesel car taxation are scheduled to take effect within weeks, with vehicles from specific manufacturing years bearing the brunt of the increases.
Post-2017 Models Face Steepest VED Increases
Motoring experts highlight that cars produced after 2017 will be disproportionately affected by what is being termed an "unfair" £790 annual tax. Shahzad Sheik, founder of the YouTube channel @BrownCarGuy, explains that these vehicles fall under a Vehicle Excise Duty regime based solely on official CO2 emissions figures.
"These are the cars that arguably are treated harshest of all," Sheik stated. "They fit under a completely different VED regime, one based purely on official CO2 emissions figures from a time when nobody really imagined that those numbers would still matter quite this much."
Detailed Breakdown of New Tax Bands
From April 2026, the revised bands for high-emission vehicles will see substantial rises:
- Band L (emitting 226-255g/km): Increases to £760 per year, up by £25.
- Band M (emitting over 255g/km): Rises to £790 per year, up by £30.
Sheik emphasized that these rates are annual and likely to continue escalating in subsequent years.
Current and Projected VED Charges
Currently, cars emitting more than 225g of CO2 per kilometre are subject to Vehicle Excise Duty as follows:
- 201-225g/km: £430 annually
- 226-255g/km: £735 annually
- Over 255g/km: £750 annually
The upcoming adjustments will raise the £735 band to £760 and the £750 band to £790 starting April 2026.
First-Year VED Charges Also Skyrocket
The government has already implemented dramatic increases in first-year VED charges for new petrol and diesel vehicles from April 2025. These upfront fees, paid by purchasers before transitioning to standard rates, have surged on a sliding scale.
Most higher bands have seen their fees double compared to 2024 levels. Notably, vehicles emitting over 255g/km faced a steep £2,745 rise, affecting some of the most commonly driven cars in Britain. This charge jumped to £5,490 for the first year and is projected to reach £5,690 from April 1, 2026.
Criticism of the Tax Structure
Sheik voiced strong concerns about the fairness of these hikes, particularly for higher-emission vehicles. "This is a segment they really need to look at again," he urged. "At the higher end these rates don’t just feel harsh, they feel deeply unfair."
The reforms represent a significant financial burden for owners of affected vehicles, with ongoing annual costs set to rise substantially under the new Labour government's environmental and fiscal policies.
