2018’s new diesel car tax changes: what you need to know

27th March 2018

Photo: bizoo_n/iStock

The cost of driving a diesel vehicle could rise by up to £500 a year from April 1st when tax rules come into force.

However, research has shown that the vast majority of motorists are either confused or oblivious to the changes to vehicle excise duty (VED).

Out of the 2,000 UK drivers surveyed by Confused.com in February, nearly half (46 per cent) believe the messaging around diesel vehicles is unclear, while almost nine in 10 motorists (87 per cent) do not know about the new law in relation to taxing new diesel vehicles.

This confusion is believed to be a key factor in why diesel registrations dropped by close to a fifth in 2017 (-17.1 per cent).

Ongoing anti-diesel sentiment from the government and media means that three in five drivers would not consider buying a diesel car, while a third said they were put off by the new taxes.

So what are the new rules?

From April 1st, 2018, new diesel cars will be subject up to £500 more in tax if they fail to meet the latest pollution standards.

Once the new rates are in place, the first-year VED tax rate for a new diesel car will jump up by one band. Additionally, the company car tax levied on diesel cars will increase from three per cent to four per cent.

Note that the new rules only apply to cars, not vans or commercial vehicles, and the extra cost is only payable for models that don’t meet the latest Euro 6 emissions standards when tested on the RDE new real-world emissions regime.

Currently, no new diesels conform to the RDE standards, so the extra fee will apply to all new diesels on the market.

What does this mean in terms of cost?

For the ubiquitous Ford Focus diesel with 99g/km CO2, the cost of first year VED will rise by £20 to £145.

However, for the Range Rover Evoque SD4 with 153g/km CO2, VED will rise by a whopping £315 to £830.

After the first year, VED drops to £140 a year for all diesel vehicles.

Any diesel vehicles currently on the road won’t be affected by the change because the law only applies to diesels registered on or after April 1st.

Despite this, many drivers either seem to think the rules apply to all diesel vehicles or are unaware of the taxes altogether.

Full list of revised diesel car VED changes:


Photo: bizoo_n/iStock