Road Tax Increases in 2025

The Autumn budget of 2024 impacted everything from schools to small businesses but an often overlooked element was the commitments and plans for Britain’s roads, including changes to vehicle and excise duty (VED) from April 2025. In this article we help road users navigate their way through the changes from impacts to Electric Vehicles to pothole repairs 

The Rise in Road Tax

Perhaps most shocking was the announced changes that EV (electric vehicle) owners will now need to pay road tax, taking away a long standing benefit for early adopters but all road users will be impacted in some way. As we move towards cleaner, safer roads, understanding these changes is important for motorists to stay informed.

From April 2025, electric vehicles (EVs) will lose their exemption from Vehicle Excise Duty (VED). Buyers will pay a first-year rate of £10, the next lowest tier, instead of the standard rate. Annual rates will remain at £10 until 2029-30, offering some relief for EV owners compared to traditional vehicles.

Hybrid and internal combustion engine (ICE) cars face steeper VED increases. Cars emitting 1-50 g/km CO2, including hybrids, will see annual rates rise from £10 to £110 for 2025-26. For cars emitting 51-75 g/km CO2, rates will increase from £30 to £130. Vehicles emitting 76 g/km CO2 or more will face doubled rates, with first-year examples like £440 for a Ford Puma mild hybrid and £5490 for a Land Rover Defender.

The 2025 road tax increase will hit older, high-emission petrol and diesel vehicles hardest. These vehicles, failing to meet newer emission standards, will face higher taxes, making them less financially viable. Older vehicles are more prone to breakdowns, especially on poorly maintained roads. These vehicles have been linked to a rise in the number of breakdowns overall with the average age of the cars on our roads going from 6.6 to 9.4.

Electric Vehicles Back on for 2030

The government has also re-introduced plans to stop the production of petrol and diesel vehicles by 2030 along with other incentives for electric vehicles so while the road tax allowance being scrapped might put some people off, the demand for electric vehicles and the increased adoption is expected to continue to rise. 

It will therefore come as a relief that ‘range anxiety’ is seemingly a thing of the past with recent statistics showing a 1.85% breakdown rate for electric vehicles due to being ‘out of battery’. Most stats are now starting to mirror that of typical petrol and diesel vehicles so this is a positive sign that electric vehicles are becoming more reliable.

More Support for Potholes

As always, we like to look at how these changes will help to make our roads safer and how these changes will impact your daily drive beyond the rise in road tax. One such change is the commitment to improving repairs on potholes with an additional £500 million worth of funding in road maintenance pledged by the government. 

It’s no secret that Britain’s roads are marked by potholes up and down the country with the total number of potholes averaging over a million according to most sources. This has a major impact on the safety of the drive, particularly with most major roads often poorly lit. Hitting a pothole can cause serious damage to your car with most incidents causing damage averaging £460 to repair. Even just attempting to evade a pothole can cause an accident and the AA reports that they attended 800,000 breakdowns related to potholes just over January to September last year. 

For a breakdown of just how much potholes are impacting your journey, here’s a collection of statistics that make for interesting, if not infuriating, reading : 

• The UK averages around 6 potholes per mile in England and Wales
• Pothole-related breakdowns jumped by a fifth (17%) in the final three months of 2024
• Drivers are 1.7 times more likely to breakdown due to potholes today than in 2006
• Between 2021 to 2023, the average number of breakdown claims sent to local councils that were refused has risen from 76% to 81%.
• On average, a council payout is 43% less than the average cost of the repair

The road tax increase in 2025 represents a significant shift in the UK’s approach to road transport, with wide-reaching implications for various types of vehicles and road users. As these changes unfold, Roadflash remains committed to helping motorists navigate the evolving landscape of road tax and vehicle safety. By offering comprehensive resources and expert advice, we ensure that our readers can stay informed, reduce their environmental impact, and contribute to safer roads for everyone. 

In addition to providing helpful guidance on road tax and vehicle safety, Roadflash also offers practical products like the Emergency Breakdown Warning Light. This essential tool enhances road safety by ensuring drivers are visible during breakdowns, helping prevent accidents in low-visibility conditions. Stay safe on the road with Roadflash’s reliable products and expert advice, and make smarter choices for both your safety and the environment.