In an attempt to encourage car owners to select cars which emit less carbon, the UK government has introduced a new green car tax (Vehicle Excise Duty) scheme which effectively penalises those owning cars which produce high levels of carbon emissions. Green car tax bands from A to M vary in price for a year from £35 to £405 (2009 prices) for a petrol or diesel car with cars running on alternative fuels ranging from £15 to £390.
As well as increasing the annual tax payment for many car owners, the green car tax will also include a new ‘showroom tax’ or ‘first year rate’ from April 2010. This is the green car tax for brand new vehicles for the year in which they are purchased, and is often much higher than the standard tax payable on that car. The amount reduces back to the original tax band following the first year. More details can be see on the DirectGov website. Cars registered before the 1st March 2001 are taxed differently with tax based on engine size rather than the green car tax bands.
When buying a car you can check which green car tax band the vehicle will fall into by checking the Vehicle Certification Agency Car Fuel Data website.
The current tax bands can be viewed at the DirectGov website.
Source: www.direct.gov.uk 2009
