Car tax rates will change significantly from April 2025, with electric vehicles paying £10 for the first time, hybrids paying £110, and high-emission vehicles seeing doubled rates up to £5,490 in the first year. The Expensive Car Supplement for vehicles over £40,000 remains unchanged.

The fuel duty freeze will continue until March 2026, saving average drivers £59 in the upcoming financial year. The planned increase for 2025/26 has been cancelled.

The government is reviewing the zero-emission vehicle (ZEV) mandate requiring 28% of new car sales to be electric, following pressure from manufacturers. Recent EV support includes £200m for charging infrastructure and £120m for plug-in van grants and wheelchair-accessible EVs.

British car manufacturing faces challenges, with Stellantis closing its Luton factory (1,100 job losses) and BMW delaying a £600m Oxford Mini plant upgrade. The government may introduce protective measures for the industry.

The new Fuel Finder tool, launching by year-end, could help drivers save 1-6p per liter on fuel costs, similar to Northern Ireland's successful program.

Industry experts recommend:

• Removing tax disincentives on EVs over £40,000
• Raising the EV tax threshold to £60,000
• Implementing a 2-3 year pause on punitive tax policies
• Installing home charging grants
• Introducing new green incentives
• Ensuring affordable EV insurance options

These changes aim to support the transition to electric vehicles while maintaining stability in the automotive sector.

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