VED raises road tax for millions of motorists

Official estimates reveal the vehicle excise duty (VED) will increase for 44% of vehicles – up by up to £245 for the most polluting cars – but for 33% the VED will fall.

The estimates, which were revealed for the first time in a parliamentary answer by Treasury minister Angela Eagle, are likely to reignite the dispute over road tax changes, which have attracted fierce criticism from Labour MPs, BBC News reports.

The government has already had to offer concessions to its backbenchers after criticism that poorer motorists will be hit harder by the decision to apply the new rates to all cars registered since 2001.

Eagle said experts believe that in 2009-10, ‘a third of cars will be better off in real terms, and in total, approximately 55% of cars will be no worse off’. She said about 8.7 million vehicles, all in the six top-polluting bands, would pay more.

Further reading:

Tory plan to amend Finance Bill fails

Darling faces more tax rage over backdated vehicle excise

Read the BBC News story