Waldo Posted August 6, 2015 Share Posted August 6, 2015 I've been thinking of getting a car that currently is only £20 a year to tax. The low road tax was part of the reason for me choosing this particular model of car. I noticed with the last budget, they're going to change the road tax to flat rate, is that correct? So a car that used to be £20 to tax will soon be much more than that? Can anyone clarify the situation please? Thanks, Link to comment Share on other sites More sharing options...
El Cid Posted August 6, 2015 Share Posted August 6, 2015 Is that flat tax just the first tax, when you buy the car brand new? Link to comment Share on other sites More sharing options...
Waldo Posted August 6, 2015 Author Share Posted August 6, 2015 This bit... However, Chancellor George Osborne announced in the Summer Budget that the system is due to change. From April 2017, a flat rate of £140 will be introduced for most cars, while owners of brand new cars could face even higher rates of up to £2,000 in the first year. Those who pay more than £40,000 for a brand new car will also have to pay a £310 supplement on top of the standard rate for five years. The government argues that the system is being revised to make it "fairer and sustainable", encouraging drivers to buy the cleanest cars. Money raised will be put into a Roads Fund. The new rules essentially target new car owners, with Osborne promising that nobody will pay more road tax for a car that they already own. Cars emitting 0 grams of carbon dioxide per kilometre (gCO2/km) will continue to pay no road tax. Source: http://www.theweek.co.uk/uk-news/59941/road-tax-changes-explained-how-to-renew-your-tax-disc-5 So, if I already own a car that is currently £20 per year road tax; when the new flat rate tax comes in to effect in April 2017, I will still only pay £20 per year, because I already own the car? Link to comment Share on other sites More sharing options...
WiseOwl182 Posted August 6, 2015 Share Posted August 6, 2015 Money raised will be put into a Roads Fund. Source: http://www.theweek.co.uk/uk-news/59941/road-tax-changes-explained-how-to-renew-your-tax-disc-5 Something to throw a spanner in the works for all the cyclist v driver threads. Link to comment Share on other sites More sharing options...
altus Posted August 6, 2015 Share Posted August 6, 2015 Something to throw a spanner in the works for all the cyclist v driver threads. Not for four years. It's not that big a spanner anyway. VED only raises 2/3rds of what is currently spent on roads and Osbourne has said the reintroduced road tax won't collect any more than VED currently does. Link to comment Share on other sites More sharing options...
El Cid Posted August 6, 2015 Share Posted August 6, 2015 The government argues that the system is being revised to make it "fairer and sustainable", encouraging drivers to buy the cleanest cars. Money raised will be put into a Roads Fund. I havnt really studied the new rules, but I was surprised that the AA were criticizing them. Link to comment Share on other sites More sharing options...
WiseOwl182 Posted August 7, 2015 Share Posted August 7, 2015 Not for four years. It's not that big a spanner anyway. VED only raises 2/3rds of what is currently spent on roads and Osbourne has said the reintroduced road tax won't collect any more than VED currently does. The other 1/3, and then some, must come from fuel duty then. Link to comment Share on other sites More sharing options...
LeMaquis Posted August 7, 2015 Share Posted August 7, 2015 The other 1/3, and then some, must come from fuel duty then. The rest comes from general taxation. Other forms of general taxation are spent on providing psychiatric counselling for motorists with paranoia and persecution complexes. Link to comment Share on other sites More sharing options...
WiseOwl182 Posted August 7, 2015 Share Posted August 7, 2015 The rest comes from general taxation. Other forms of general taxation are spent on providing psychiatric counselling for motorists with paranoia and persecution complexes. Very droll. The problem with the "general taxation" claim is that the money raised from VED, fuel tax, congestion charges, tolls and even car insurance premium tax all together comes to more than is spent on road maintenance. It's a bit like the argument that smokers cost the NHS billions and the NHS is funded by "general taxation". Well yes, but tobacco tax raises more than the smokers' NHS costs, so they're actually net contributors. Link to comment Share on other sites More sharing options...
El Cid Posted August 7, 2015 Share Posted August 7, 2015 Waldo - Money raised will be put into a Roads Fund. The "Road Fund" is just meaning spin, there will not be any more money spent, and it just allows Osborn to raise VED to put more money into this "Road Fund", instead of blaming increases in green taxes, or both, if the climate change issue gains popularity. VED income is set to fall sharply as cars get greener and he has acted to avoid that. Link to comment Share on other sites More sharing options...
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