But it appears it only applies to new cars registered after that date.
Mr Osbourne added "There will be no change to VED for existing cars".
So it looks like we are OK with our low VED cars. Panic over.
Correct and MOTs movig to 4 years after registration from 3.
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I will be very interested to see how the 3 proposed bands zero, standard and premium are defined.
I guess "zero" will be for pure electric cars but where will be the changeover between standard and premium be and if standard is £140 what will premium be.
As usual as many questions as answers.
Perhaps it will dissapear like the 80 mph speed limit, remember that red herring.
With regards to the MOT the chancellor said
"In addition the Government will consult on extending the deadline for new cars and motorbikes to have their first MOT test from three years to four years?"
So its only a consultation and not a fact.
Edited by skidpan on 08/07/2015 at 15:52
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From what I understood 'premium' will be any vehicle with a list price in excess of £40,000.
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Correct, and premium will be taxed at £450.
This looks like a ploy to accelerate new car sales in 2016.
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This looks like a ploy to accelerate new car sales in 2016.
Good point. But who could really be that devious when in government.
Won't make much difference to me since if I buy the new car in 2 years time I would buy today its 134 CO's or £130 a year.
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Every new car from 2017 will be £140pa unless its list price is more than £40,000, in which case it will be £450pa for the first 5 years, or it's zero emissions, in which case tax will be zero (of course, nothing is zero emissions). First year VED is also doubled and the variation in that from £10 to £2,000 is supposed to encourage people to buy 'cleaner' cars. A VED hike had to happen and it's only fair that the people with the most expensive cars pay the most, even if they drive Teslas.
HJ
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even if they drive Teslas.
But since Teslas are Zero emission surely they will still be zero rated.
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even if they drive Teslas.
But since Teslas are Zero emission surely they will still be zero rated.
So poor people subsidise rich people's playthings? The Tories are doing the sensible thing - low emissions or not - they are taxing expensive cars and before anyone jumps down my throat - I'm reasonably wealthy, I don't see why someone struggling to run an 8 year old Mondeo for the the family should subsidise a rich bloke with a zero emission weekend plaything.
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I'm struggling to see whats fair about making owners who spend more on their car pay more.
If the money is actually now going towards the roads, then an new expensive car isnt wearing out the road any more than a cheap one, or old one.
Its kerb weight and mileage that should be used to make it fair.
Charge people who do high mileage i say, driving heavy cars.
Why are the rich always expected to pay more? I get screwed for council tax as it is just because i own a 5 bedroom Bungalow.
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Why are the rich always expected to pay more? I get screwed for council tax as it is just because i own a 5 bedroom Bungalow.
To help make things better for everyone. The more you have the more you can put in society to improve the lot of the less well off.
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Really nothing to do with some people being idle and work shy then.
A fairer society should reward those who work hard.
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Many people work hard and only come home with the minium wage. That's why the expensive car should be more expensive to tax. If you can afford the expensive car then you can also afford the extra tax - that makes it faier for people who can't afford the expensive car as their tax can be lower as there are richer people paying more on some cars which allows the lower rates of tax to exist.
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That was the philosophy behind communism, that didn't work either.
A relative of mine works hard and only gets a minimum wage, he can't afford a car, so doesn't have one, just occasionally hires one. He has a low paid job because he hasn't a trade or any qualifications, apart from fork truck driving.
On the other hand i spent 7 years in college one day a week while working as a low paid apprentice for 5 years, then lived at work for the next 32 years before retiring at 52.
Whatever car i buy i pay 20% VAT for it, that should be enough.
If i buy a gas guzzler then again a large chunk of that is taxed via the fuel.
Edited by xtrailman on 16/07/2015 at 23:26
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No. Teslas are over £40k, so they will be hit with the £310 VED at least.
Edited by Honestjohn on 09/07/2015 at 10:12
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Edited by Doc on 08/07/2015 at 17:59
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Since when has hypothecation (ring fencing) of a tax ever actually happened?
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As usual the consequences are not initially appreciated.
Five or six years from now, pre 2017 reg cars with low Ved will have greatly enhanced second hand car values, whereas post 2017 reg "premium" cars will see future second hand values tank.
Who wants to buy a 4/5 year old executive/luxury motor if it comes with an annual £450 tax bill?
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HJ detail states the £450 is only for the first 5 years.
Fact is luxo barges values tank anyway. I saw a very well specced 13 reg CL500 last week, just 14,500 miles. It was on at £45,000, this a car which had a list of about £100,000 - £3.79 per mile depreciation!
A seemingly good deal, until you come to have it serviced and repaired - cheap to buy expensive motors are always expensive to maintain.
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If you can afford to run a £40k + car then the £450 shouldn't make much difference to you.
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The real loser here if there is one at all is the owner of a car that currently pays over £140, particularly those with cars that attract the £500 annual VED, as these will continue to be taxed at the current level when a newer version of the same thing could have much lower tax, but of course they wont have paid the higher first year VED
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If the MoTs move to 4 years from new, then the likes of Ford will need to extend their warranties up to the fourth year of ownership, surely. Which they will charge more for within the price of the vehicle. Owners will have to pay a years extra servicing including parts. Id rather stick to system as is.
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If the MoTs move to 4 years from new, then the likes of Ford will need to extend their warranties up to the fourth year of ownership, surely. Which they will charge more for within the price of the vehicle. Owners will have to pay a years extra servicing including parts. Id rather stick to system as is.
Lots of cars don't pass the MOT at 3 years old, so even less at 4.
What has that got to do with warranty? It is up to the owner to maintain the vehicle. An Mot covers usually "wear and tear"/servicing items, brakes, suspension etc, will ford warrant a light bulb for 4 years? not covered at all now..
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The change to Insurance Premium Tax (IPT) will affect motorists - this will hit much sooner than the VED changes - November 2015 I believe.
It will rise from 6percent to 9.5percent. Not a big increase for oldies such as myself, but a sizeable increase for younger drivers.
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I'm just saying that dealerships will have to match the same time.
And yes things aren't included on the service bill as it is anyway and always has been. But the dealerships will use this to market the extra service plans and the extra money brought in from parts and servicing.
I know you don't need to service a car at a dealership but many will be conned into parting with cash thinking maybe they have to or for peace of mind.
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I've yet to have a car fail its first test, or its second come to that, and not had a bulb fail for that long on a car that i no longer carry a spare.
I usually keep my cars for 4.5 years.
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I am one of those people as I have a 3L petrol XF, it's 5 yrs old and I pay £485/yr VED on it.
Alas, this won't change either so I'll be paying this for the foreseeable future.
Something for me to look forward to will be when the VED crosses the £500/yr line, I reckon in the next 2 years....oh yes in 2017 no doubt!
However, as a keen cyclist as well, should I have any anyone shouting at me about how I should "pay to use the road" (see HJ www.honestjohn.co.uk/news/comment/2015-07/comment-.../ ) I will be able to reply "I am already paying £500/yr towards the upkeep of the roads!!"
Stu
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Since when has hypothecation (ring fencing) of a tax ever actually happened?
1798. Income tax. For war. (sorry, not really motoring but you did ask....)
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From what I understood 'premium' will be any vehicle with a list price in excess of £40,000.
It'll be interesting to see if that makes any difference to the way premium marques map their engines from then on, as many do so to scrape into the lowest VED band possible, often compromising driveability.
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From what I understood 'premium' will be any vehicle with a list price in excess of £40,000.
It'll be interesting to see if that makes any difference to the way premium marques map their engines from then on, as many do so to scrape into the lowest VED band possible, often compromising driveability.
Probably not, as CoCar tax will still be based on EU test figures, which require that daft mapping in the first place. I cant see them selling 2 versions, one fleet, one private. And dont forget all the manufacturers still need to get their fleet averages right down to avoid huge fines from the EU.
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