Revealed: the cars hit hardest by new tax rules

Research by What Car? has revealed that the cost of taxing a new car after 1 April 2017 could be up to 25 times more expensive, with even environmentally-friendly plug-in hybrids facing stiff penalties. Vehicle tax for the first year is based on CO2 emissions, but after that the rate depends on the type of vehicle.

From year two it’ll cost £140 for a petrol or diesel car, £130 for an alternative fuel vehicle and £0 for vehicles with zero CO2 emissions. Crucially, all cars with a list price of more than £40,000 will be subject to an £310 surcharge for five years from year two. Read on to discover the top 10 tax increases. Buy now or pay later…

10. Lexus GS 300h 2.5 F-Sport 4dr CVT: £990 increase

Register a Lexus GS 300h before the end of March and you’ll pay just £40 in tax over the first three years. Under the new Vehicle Excise Duty (VED) rates, that figure increases to £1,030, an astonishing 2,475% change over three years.

9. Lexus RX 450h 3.5 SE 5dr CVT Auto: £990 increase

As What Car? is keen to point out, conventional hybrids such as the Lexus GS 300h and RX 450h will be hardest hit, meaning luxury cars with low emissions will be less attractive than before. It’s another 2,475% change for this luxury SUV.

8. Lexus RC 300h 2.5 F-Sport 2dr CVT Auto: £990 increase

8. Lexus RC 300h 2.5 F-Sport 2dr CVT Auto: £990 increase

The three-year cost of £1,030 is made up of a £150 first-year tax rate based on its emissions, followed by two subsequent payments of the new hybrid flat rate of £130. Further misery comes in the form of the £310 a year charge for cars costing more than £40,000, payable between years two and six.

7. Mercedes-Benz C220d AMG Line 2dr: £1,000 increase

There’s worse news if you’re thinking of buying a Mercedes-Benz C220d Convertible in April, with the AMG Line model subject to a £1,000 increase in tax. Buy now and pay £60. Buy in April and pay £1,060, which represents a 1,667% hike.

6. Audi A5 2.0 TDI Sport 2dr S tronic: £1,000 increase

What Car? editor, Steve Huntingford, said: “The new tax laws are designed to increase the advantage of running a zero emissions car, but they make things much more complicated and push up the prices of many ‘bread and butter’ models.”

5. Mercedes-Benz E200d AMG Line Premium 4dr 9G-Tronic: £1,000 increase

5. Mercedes-Benz E200d AMG Line Premium 4dr 9G-Tronic: £1,000 increase

The new VED rates apply to all new cars registered on or after the 1 April 2017, but do not affect old cars or new cars registered before or on the 31 April 2017. Be quick and you can escape the increase.

4. Mercedes-Benz C250d AMG Line Premium Plus 4dr 9G-Tronic: £1,000 increase

The £310 surcharge for cars costing more than £40,000 will affect drivers of even the most fuel efficient vehicles. Take the Tesla Model S, for example, which, while free to tax in year one, will cost £310 a year between years two and six.

3. Audi A6 3.0 TDI S Line 4dr S tronic: £1,000 increase

The Audi A6 3.0 TDI with the S tronic transmission will jump from £60 to £1,060, a percentage change of 1,667%. Head down to your Audi dealer before the end of the month to escape the hike.

2. Mercedes-Benz C250d AMG Line Premium 2dr Auto: £1,000 increase

2. Mercedes-Benz C250d AMG Line Premium 2dr Auto: £1,000 increase

Under the current scheme, all cars with sub 130g/km CO2 emissions are exempt from VED in the first year, with sub 100g/km cars free of tax from year two. From 1 April, only cars with zero emissions are tax exempt. This is why luxury cars with low emissions are the hardest hit.

1. Mercedes-Benz S300h L AMG Line 4dr Auto: £1,000 increase

Your typical Mercedes-Benz S-Class owner is unlikely to be too bothered about VED costing 25 time more than before, but £1,000 remains a chunky wedge of cash to find over three years.

Which hybrid cars will cost more to tax?

Which hybrid cars will cost more to tax?

The £310 surcharge for vehicles costing more than £40,000 is going to hit buyers of luxury hybrid models in the wallet. On the flip-side, some vehicles will be eligible for a government grant of £2,500 if their CO2 emissions are less than 75g/km. What Car? has provided details of six popular hybrid and plug-in hybrid models.

Volvo XC90 T8 Hybrid Inscription 5dr Geartronic: £880 increase

Register a Volvo XC90 T8 before the end of March and you’ll pay nothing in VED. From April, you’ll pay £880 for the first three years. Our advice is simple: buy now.

Mitsubishi Outlander PHEV 4hs 5dr Auto: £880 increase

It’s a similar story for the Mitsubishi Outlander PHEV, which goes from zero to £880 overnight. Makes that £2,500 grant seem even more appealing.

Audi Q7 3.0 TDI Quattro e-tron 5dr Tip Auto: £880 increase

Audi Q7 3.0 TDI Quattro e-tron 5dr Tip Auto: £880 increase

Without wishing to sound like a broken record, it’s the same story for the Audi Q7 e-tron. Although the 48g/km Q7 is tax exempt in year one, it costs £130 from year two and is also subject to the £310 surcharge for cars costing more than £40,000.

Porsche Cayenne S E-Hybrid 5dr Tiptronic S: £895 increase

Thanks to CO2 emissions of 75g/km, the Porsche Cayenne S E-Hybrid is subject to a first year alternative fuel VED rate of £15, which makes it slightly more expensive than the Audi Q7 e-tron.

BMW X5 xDrive40e SE 5dr Auto: £970 increase

At 78g/km CO2, the BMW X5 xDrive40e is even less efficient than the previous two cars and slots into the fourth tier of the new VED tax bands. Alternative fuel cars emitting between 76 and 90g/km will pay £90 in year one.

Lexus RX 450h 3.5 SE 5dr CVT Auto: £990 increase

Lexus RX 450h 3.5 SE 5dr CVT Auto: £990 increase

It’s the Lexus RX 450h once again, and a reminder of that 2,475% increase in VED.

Britain’s best-sellers

Buyers of Britain’s most popular cars won’t escape a tax penalty, with six out of the top 10 best-selling vehicles set to incur eye-watering tax increases. As the What Car? analysis reveals certain derivatives of the top-sellers will command an extra tax bill of between £400 and £1,000 over three years.

Vauxhall Astra 1.0T ecoFLEX Design 5dr Easytronic: £400 increase

Register a Vauxhall Astra with a 1.0-litre turbocharged engine and Easytronic transmission before the end of March and you’ll pay no VED. From April, you’ll pay £400.

Ford Focus 1.5 TDCi 120 ST-Line Navigation 5dr Powershift: £400 increase

Ford Focus 1.5 TDCi 120 ST-Line Navigation 5dr Powershift: £400 increase

The same penalty applies to the Astra’s chief rival, the Ford Focus. From zero to £400 overnight.

Nissan Qashqai 1.5 dCi Acenta (Comfort/Tech Packs) 5dr: £400 increase

Britain’s most popular crossover will be slightly less attractive in April. Well, buyers will be £400 worse off.

Audi A3 1.6 TDI SE 5dr S tronic: £400 increase

And, the same is true of the Audi A3 1.6 TDI in SE trim and when fitted with the S tronic transmission.

BMW 340i M Sport 5dr Step Auto (Business Media): £845 increase

BMW 340i M Sport 5dr Step Auto (Business Media): £845 increase

Right now you’ll pay £555 to tax a BMW 340i M Sport for the first three years, but that figure rockets to £1,400 in April. That’s an increase of 152%.

Mercedes-Benz C350e Sport Premium 4dr Auto: £895 increase

And finally, the Mercedes-Benz C350e hybrid shoots from zero to £895. Remember, the new VED rates apply to vehicles registered on or after 1 April 2017, so there’s still time to beat the taxman. Just.