From 1st April, Vehicle Excise Duty (VED) will be calculated in the first year from a car’s CO2 emissions (as is the case currently). However, in the second year and beyond, the majority of cars will move to a standard rate of £140 per year. Cars with zero emissions will be exempt from new, while others priced over £40,000 will be charged an additional £310 a year, on top of the standard rate, for the following five years.
As market leader with the most customers to guide through the transition, Ford began advising its car buyers last year on the changes. The customer liaison necessary, by Ford HQ and dealer staff, is at a level not seen since the government’s scrappage scheme in 2009.
Ford’s most sought-after models such as Mustang, RS and Edge have longer leadtimes, meaning that those buyers were made aware first of the March 31 deadline to register cars against lower outgoing VED bands.
All become more expensive to tax from April – apart from coupé Ford Mustang V8s, which become almost £200 a year cheaper over six years. Right-hand drive 5.0-litre Fastbacks, costing well under the new system’s premium rate £40,000 threshold, become £995 more tax efficient in this period.
The zero first-year VED rate currently applies to 93 per cent of new Ford Fiestas – Britain’s best-selling car – thanks to emissions under 131g CO2/km emissions. February and March’s introduction of the new 17-plate are set to prompt a surge in Fiesta sales ahead of the new annual VED levy of at least £140 on every model in the range.
Andy Barratt, Ford of Britain chairman and managing director, said: “After last month’s biggest January vehicle sales volume for Ford since 1990, these imminent VED changes are driving further sales peaks. I anticipate a bumper March especially as buyers move fast to beat the tax man.”