How 2008 Budget will affect motorists

In his first Budget, Chancellor Alistair Darling has announced higher road tax for cars with high emissions, but delayed implementing this 2p rise per litre in fuel duty for six months until October 2008. However, fuel was not the only item on the agenda which will affect motorists, additional outcomes from the Budget included:

Band G vehicles e.g. Subaru Impreza 2.5 WRX STi Type UK (which have a CO2 emissions at 226g/km or higher and registered from March 23, 2006) will suffer a £100 increase in road tax

Bands C – F car owners will see an increase of £5 on road tax, cars in this band may include Honda Civic 2.2 CTDi SE, Ford Focus 1.6 Zetec, BMW X3 2.0d SE or Kia Sedona 2.9 CRDi GS

Owners of small cars such as a SEAT Ibiza 1.4 TDI Ecomotive or Toyota Prius T3 in Bands A – B will not be charged any more than last year.

A 2009 reform of Vehicle Excise Duty to encourage drivers to choose cleaner cars was also mentioned. Owners of small cars and compact family cars are likely to pay less road tax in future with a CO2 emissions 150g/km threshold. While more cars will be exempt from road tax during their first year of registration, high polluting vehicles will pay double in their first year.

There are also new trials planned with a view to introducing toll roads in the future.

Kieren Puffett, editor of Parker’s Car Guides comments: “Making a well-informed choice about what car you drive now and in the future will have a bigger impact on your wallet than ever.
While the cost of fuel remains expensive, car owners can minimise their annual running cost by seeking out the low emission versions of the cars that suit their needs. Not only will this lead to lower annual road tax, these cars will also be the most economical on fuel.”

For more information, visit parkers.co.uk.