Budget 2021: Road Tax rates for new cars in 2021/2022

Published 03 March 2021

These are 2021/2022 rates of Vehicle Excise Duty (also known as car tax or road tax) as announced in the Budget 2021. 

These updated VED bands affect cars first registered on or after 1 April 2017. The new rates take effect on 1 April 2021. 

Alternative fuelled vehicles, including hybrids, bioethanol and liquid petroleum gas, pay £145 per year. 

Want to know how much it’ll cost to tax a car registered before 2018? Click here

Tax year 2021 to 2022   
CO2 emissions (g/km) Standard rate
First Year Rate First Year Rate
Diesel vehicles*
0 £0 £0 £0
1-50 £155 £10 £25
51-75 £155 £25 £115
76-90 £155 £115 £140
91-100 £155 £140 £160
101-110 £155 £160 £180
111-130 £155 £180 £220
131-150 £155 £220 £555
151-170 £155 £555 £895
171-190 £155 £895 £1345
191-225 £155 £1345 £1910
226-255 £155 £1910 £2245
Over 255 £155 £2245 £2245

*Applies to diesel vehicles that do not meet the real driving emissions step 2 (RDE2) standard.

Cars with a list price of over £40,000 when new pay an additional £325 per year on top of the standard rate, for the first five years before returning to the rates listed above. 


More on road tax.


Steve dee    on 3 March 2021

It could lead to a lot of potential classics going to the scrap yard

999pez    on 3 March 2021

It could lead to a lot of potential classics going to the scrap yard

Why, this is the VED for new cars not classics?

Ardenpops    on 4 March 2021

Classics (over 40 years old) don’t pay any tax

The BigMac    on 3 March 2021

How long has the £40,000 list price starting mark been in operation? With there being NO upward adjustment (even at the CRPI) does that not then make any assessment of VED bench mark so much more of a tax on the individual's desire to improve on the quality/class of vehicle when price increases - Brexit influenced - can be influenced by exchange rates, amongst many factors? With the £40,000 level not increasing as the years progress, there will be a more than inflationary depreciation in the choice of vehicles coming in below this cost level. The purchase of a car is quite possibly the second most expensive item a person will make in their life, after a mortgage, so it becomes more galling to me that in working hard through my life to improve my 'lot' there is a growing desire from the government TO TAX me for this desire!! Regretfully, my 'choice' to own my car and enjoy independence from reliance on inadequate public transport provision (along with exorbitant costs) is penalising me for not living in the heart of any of the country's major conurbations. The impending government steamroller move to 'electrify' the country defies understanding on HOW charging points will be readily available for electric drivers, NEVER MIND the capability to supply the 'raw material', as well as recover some of the lost tax revenue from VED and fuel duty. Beware electricity - your tax due time is just around the corner! Amongst the consequences of encouraging economic recovery from Covid-19 will be a MASSIVE debt that I believe my great grandchildren will still be paying off, there's a shudderingly realistic feeling of paying MORE tax, so I suppose I should smile, and accept this taxation on my desire to improve my 'lot'. Sorry great grandkids, it looks like I'm not going to be leaving you with anything - EXCEPT DEBT!

Paul Murphy    on 4 March 2021

Mr BigMac

I'll keep this short.

If you can afford a car of over £40000 then I'm sure you can afford the VED on that car.

Ardenpops    on 4 March 2021

I think £40k is quite a reasonable limit as there are quite a number of perfectly good new cars priced below that price for anyone who just wants a reliable car to get from A to B.
If you want to spend more for more prestige, luxury speed or whatever then you have to accept that you should pay more tax. Its the way taxes should work.
For info my car cost nearly double the limit, wouldn’t say Im happy to pay the tax, But I accept it was my choice.

aethelwulf    on 4 March 2021

Anything to the taxpayer's advantage is frozen or rated to CPI but anything to the Treasury's advantage is increased by RPI . It is never going to change that is why RPI is not abolished as it suits the government to retain it . Also teh PFI projects that the idiot councils signed up to are increased by RPI so we must keep the foreign banks happy. I thinks we're lucky us motorists are caned harder in the budget as there is a massive shortfall in taxes out there.

sammy1    on 5 March 2021

The BigMac,


Even if you buy a 3year old car you are caned, high spec A1s and Minis will soon be north of £40k

   on 27 March 2021

Agree if someone can afford a £40K+ vehicle then they can afford the extra VED. But that's not the problem. A car costing just over £40K may be almost half that in 3 years time. For example, someone who can only afford say around £20K to buy a decent used car can then be penalised with the extra VED if the car they are buying was over £40K new. The historic new price of a used car should be completely irrelevant to VED and that's why this is effectively penalising someone who can't afford £40K for a car.

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