Road tax to hit £200 in April: who pays more in 2026?
VED (road tax) is set to rise to £200 a year from April. See who’s affected, how the Expensive Car Supplement works, and ways UK drivers can cut costs.

James Wilson
28 March 2026

Road Tax Is Hitting £200 in April — Here's Everything You Need to Know
There's a particular kind of British frustration that comes from watching costs pile up with no obvious way to push back. Petrol prices are volatile, insurance premiums have been punishing, and now, right on cue for the new financial year, Vehicle Excise Duty is creeping upward again. From April 2025, the standard rate of road tax rises to £200 per year — a modest-sounding £5 increase that, in isolation, barely registers. But zoom out and the picture looks rather different.
What's Actually Happening
As reported by Auto Express, Vehicle Excise Duty (VED) — universally known as road tax, despite that term being technically abolished back in 1937 — is rising by £5 to reach £200 per year for the majority of petrol and diesel cars registered after April 2017.
The increase isn't unexpected. The government confirmed in the Autumn Statement that VED rates would rise broadly in line with the Retail Price Index (RPI), which is standard practice. What makes this particular moment feel sharper is the context: it lands at the same time as fuel duty changes, insurance premium tax remaining stubbornly high, and a general squeeze on household budgets that has made every line item on the motoring bill feel more significant than it used to.
But the standard rate is only part of the story. Drivers of newer, higher-value vehicles face an additional sting in the form of the Expensive Car Supplement — a surcharge that can push the annual bill significantly higher, and which catches far more drivers than the name might suggest.
Why This Matters More Than £5 Suggests
Let's be honest: a £5 annual increase, on its own, is not going to derail anyone's finances. It works out at less than 10p per week. So why does it matter?
The answer lies in what VED represents within the broader motoring cost picture, and in the cumulative effect of incremental increases that have been quietly compounding for years.
Vehicle Excise Duty has a complicated relationship with fairness. The flat-rate system — where a Ford Fiesta driver and a Range Rover driver pay the same £200 — replaced the older CO₂-based sliding scale for cars registered after April 2017. Before that date, low-emission vehicles could pay as little as nothing at all in VED. The 2017 reform was designed partly to address a revenue shortfall caused by increasingly fuel-efficient cars, and partly to simplify the system. Whether it succeeded in either aim is debatable.
What it undeniably did was shift the burden. Drivers of modest, efficient cars — the ones least able to absorb additional costs — now pay the same flat rate as drivers of far more expensive vehicles. The progressive element of the old system, imperfect as it was, has largely disappeared.
The Expensive Car Supplement: A Stealth Tax on Middle England
The Expensive Car Supplement (ECS) is where things get genuinely complicated. Introduced in 2017, it applies to any car with a list price exceeding £40,000 when new, and requires drivers to pay an additional surcharge on top of the standard rate for five years from the date of second registration (i.e., the second time the car is taxed, which is the year after first registration).
The current ECS stands at £410 per year, meaning affected drivers pay a combined annual VED bill of £610. That's not an insignificant sum.
Here's the catch that trips up thousands of drivers every year: the £40,000 threshold has not been meaningfully adjusted for inflation since the supplement was introduced. What felt like a luxury-car measure in 2017 now sweeps in a substantial range of mainstream family vehicles. Mid-range electric SUVs, well-specified executive saloons, and popular family cars from premium brands routinely breach the threshold with even modest optional extras added. Drivers who bought what felt like a sensible, mid-market car several years ago may find themselves paying the supplement without ever having felt like they were buying a "luxury" vehicle.
The Legal Framework Behind VED
Vehicle Excise Duty is governed by the Vehicle Excise and Registration Act 1994 (VERA 1994), which sets out the legal basis for taxing vehicles used or kept on public roads in the United Kingdom. The rates themselves are set annually by Parliament through the Finance Act — which is why the April increase is essentially baked in once the Chancellor announces it.
Under VERA 1994, it is a criminal offence to use or keep an unlicensed vehicle on a public road. The DVLA enforces this through Automatic Number Plate Recognition (ANPR) cameras, which continuously cross-reference plates against the database of taxed vehicles. If your vehicle isn't taxed, you can expect an out-of-court settlement letter demanding £80 (reduced to £40 if paid promptly), plus back-payment of any VED owed.
Importantly, the legal requirement applies to vehicles kept on a public road, not just those being driven. This is a distinction that catches people out. You don't have to be behind the wheel for an offence to occur — simply leaving an untaxed car parked on a public street is enough to trigger enforcement.
The one legal escape hatch is the Statutory Off Road Notification (SORN), which allows you to declare a vehicle off the road and exempt it from VED requirements — provided it is genuinely kept off public roads, on private land.
What Drivers Should Know Right Now
Here are the practical steps worth taking as the April changes come into effect:
1. Check your renewal date. VED is renewed monthly, and your renewal notice will reflect the new rates. If you're renewing on or after 1 April 2025, you'll pay the higher rate. There's no mechanism to lock in the old rate early.
2. Verify whether the Expensive Car Supplement applies to you. The DVLA's vehicle enquiry service (available on GOV.UK) will show the VED status and applicable rates for any registered vehicle. If you're unsure whether your car's original list price exceeded £40,000 — particularly if you bought it used — check the original manufacturer's invoice or contact the dealership. The supplement is calculated on the original list price including options, not the price you paid.
3. Don't let your VED lapse, even briefly. The ANPR enforcement net is wide and largely automated. There is no grace period in law for an expired VED — enforcement can and does happen on the day of expiry.
4. If you're considering SORN, understand the restrictions fully. A SORN is not a loophole for keeping a car on the road cheaply. It is a declaration that the vehicle will not be used or kept on a public road. Breaching a SORN carries a fixed penalty of £100 and potential prosecution.
5. Electric vehicle owners: your exemption is ending. From April 2025, zero-emission vehicles — including pure electric cars — lose their VED exemption and will pay the standard rate for the first time. This is a significant change that affects a growing number of drivers and represents a meaningful shift in the cost calculus of EV ownership.
Looking Ahead: A System Under Pressure
The April increase is, in the grand scheme of things, a small adjustment. But it arrives as part of a broader renegotiation of how motoring is taxed in the UK — one that will accelerate over the coming years.
The government faces a structural problem: as more vehicles shift to electricity, fuel duty receipts will decline. Fuel duty currently raises approximately £25 billion per year for the Treasury. VED raises a further £7 billion or so. Together, they represent a substantial chunk of public revenue that is directly tied to behaviours — driving petrol and diesel cars — that government policy is actively trying to discourage.
The logical destination, which the government has been edging towards for years, is some form of road pricing — a system where drivers pay based on miles driven, time of day, or road type, rather than through flat-rate taxes and fuel duty. Various consultations and pilot schemes have been floated, and the political resistance is significant. But the fiscal arithmetic makes some form of reform increasingly hard to avoid.
In the meantime, drivers should expect VED to continue rising at or above inflation, the Expensive Car Supplement to catch an ever-wider pool of vehicles as car prices rise, and the EV exemption to become a distant memory.
The £5 increase to £200 is not the headline that will define motoring taxation in the 2020s. But it is a data point in a trajectory that every UK driver has an interest in understanding — and pushing back on where the opportunity arises.
Source: Auto Express — "Pricey petrol not bad enough? Drivers brace for £200 road tax in April"

Written by
James Wilson
Legal Counsel
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