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CO2 Emissions and Road Tax

By: Tracy Wilkinson - Updated: 7 Oct 2012 | comments*Discuss
 
Road Tax Motoring Budget Co2 Emissions

If you drive a car in the UK, you've probably noticed some changes in the price of your car tax over the last few years. Road Tax, or Vehicle Excise Duty (VED) has undergone a bit of a transformation which has seen the end of the standard prices based on engine size - previously you didn't really need to budget for your road tax payment - you just paid one price depending on whether or not your car had an engine size of under or over 1549cc. However recent changes have seen the introduction of a system that categorises car models by vehicle emissions, and specifically, the amount of CO2 they emit in grams per kilometre (g/km) when driven.

Cars from Pre-2001

If you have a car that predates 2001 - then you're not going to be affected by the new regulations. Your tax will still be based on your engine size, and is split into two different costings, as follows:

  • Engine size : less than 1549cc = £120 per year or £66 for 6 months
  • Engine size : more than 1549cc = £185.00 per year or £101.75 for 6 months

New or Post-2001 Cars

If you buy a petrol or diesel powered car that is registered after 1 March 2001, then the price of your road tax will be worked out by measuring the Co2 it emits as follows*:

  • Band A : c02 = up to 100 g/km is exempt from car tax
  • Band B : C02 = 101-200 g/km - £35 for 12 months/n/a for 6 months
  • Band C : C02 = 121-150 g/km - £120 for 12 months/£66 for 6 months
  • Band D : C02 = 151-165 g/km - £145 for 12 months/£79.75 for 6 months
  • Band E : C02 = 166-185 g/km - £170 for 12 months/£93.50 for 6 months
  • Band F : C02 = Over 185 g/km - £210 for 12 months/£115.50 for 6 months
  • Band G : C02 = Over 225 g/km (cars reg. on/after 23/03/06) £400 for 12 months/£220 for 6 months - this will rise in 2009

If you buy an alternative fuel car, the road tax will be as follows:

  • Band A : c02 = up to 100 g/km is exempt from car tax
  • Band B : C02 = 101-200 g/km - £15 for 12 months/n/a for 6 months
  • Band C : C02 = 121-150 g/km - £100 for 12 months/£55 for 6 months
  • Band D : C02 = 151-165 g/km - £125 for 12 months/£68.75 for 6 months
  • Band E : C02 = 166-185 g/km - £150 for 12 months/£82.50 for 6 months
  • Band F : C02 = Over 185 g/km - £195 for 12 months/£107.25 for 6 months
  • Band G : C02 = Over 225 g/km (cars reg. on/after 23/03/06) £385 for 12 months/£211.75 for 6 months - this will rise in 2009

Why are Cars now Classified by the CO2 they Produce?

It's estimated that personal motoring in the UK is responsible for 13 percent of Britain's overall greenhouse gas emissions and so contributes to both the growing problem of congestion, and air pollution. By classifying cars by their Co2 emissions and charging in relation to this, the government are hoping to encourage motorists to choose 'greener' more environmentally and economically friendly cars in place of large or high performance cars.

So What are the Benefits of 'Greener Cars'?

There are lots of efficient cars around which use less fuel and produce fewer emissions, so can save you money on both your fuel costs and on taxing your vehicle. If you look at different models of the same car it can be quite surprising how little is different between them even though the cost of their car tax can vary quite a lot.

If you're looking around a car showroom, have a look at the fuel economy labels: this will tell you everything you need to know about the fuel efficiency of the car you are looking at. The ratings go from <100-226+ and are graded in colours which go from green for group A - the most efficient group, through to yellow to orange, ending in red for group G - the least efficient group. The labels may also tell you how much you will need to pay for your car tax.

Ultimately, the decision is yours - there are no laws yet that say you must drive the most environmentally friendly car you can find, but if you do choose to drive a high performance or larger vehicle, then it is likely that you will have to carry on paying for the privilege.

*Prices were correct at the time this article was written, but are subject to change.

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