New car tax 2020 changes are ‘bad news’ for petrol and diesel owners says expert

New car tax 2020 changes are ‘bad news’ for petrol and diesel owners says expert

Car tax updates will cause issues for new owners of petrol and diesel cars who will likely be hit with higher payments, according to the car specialist. Mr Kindred said the changes would cause a lot of confusion among motorists but confirmed some new owners will be caught out by the updates. 

Speaking to Express.co.uk, he said: “Car tax changes coming in this month see more cars facing VED charges, with those driving or buying a hybrid vehicle expected to pay tax for the first time. 

“While this price is still lower than the price paid for petrol and diesel cars, this moves us one step closer to the wider adoption of electric vehicles. 

“Following the announcement of the 2040 ban being brought forward by five years.”

Changes in how VED rates are calculated have now come into effect as the system for testing vehicle emissions changes. 

READ MORE: Motorists could pay over £1,000 for cars due to this tax change

The previous New European Driving Cycle (NEDC) tests have been removed with a new system aimed at taking even more accurate readings. 

The new Worldwide Harmonised Light Vehicles Test Procedure (WLTP) process is used by many manufacturers to offer more accurate readings for costumes. 

The new system will offer more accurate readings for a car’s overall fuel consumption and emissions which is likely to push motorosts into higher tax bands. 

This will see first year tax costs increase for many new car owners with some motorists set to pay over £1,000, according to AutoTrader. 

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Last week, AutoTrader claimed tax for expensive models such as an Audi Q5 could be as much as £1,285 in the first year.

The car retail experts also warned those looking to buy an SUV may be most affected by the changes as vehicles with larger engines would be hit harder. 

Alex Kindred told Express.co.uk the changes would see an increase in costs for new buyers but confirmed the updates would not affect second-hand vehicles. 

He said: “Unfortunately, the changes coming in this month brings bad news for petrol and diesel owners. 

“A change in the way that emissions are calculated means that drivers who purchase new petrol or diesel vehicles will likely be hit with a bigger initial car tax payment.

“Although, this doesn’t affect drivers who buy a second-hand vehicle.

“With different rules for new and older vehicles, and 13 potentially tax bands for each, there’s undoubtedly a lot of confusion on where we stand when trying to tax our car.”

Many of the new car tax changes have been introduced to increase awareness and take-up of electric vehicles. 

Owners of EV’s will benefit from a series of breaks which will see tax charges effectively eliminated for all electric car drivers. 

Those with an electric car are already exempt from standard VED car tax payments although cars over £40,000 had to pay a yearly £320 fee. 

This charge has been removed in the latest refresh as an extra incentive to take up the eco-friendly vehicles. 

Benefit-in-kind charges for company cars have also been removed which will see prices fall on many popular electric cars purchased under salary sacrifice schemes. 

Added tax on company cars has been slashed from 16 percent to zero under the policy which will lead to major reductions. 

Car experts have said prices on popular models such as the Tesla Model 3 and Nissan LEAF will dramatically fall under the changes.

Published at Mon, 06 Apr 2020 08:08:00 +0000