Vauxhall cuts EV prices in UK in response to tax changes
The change means people buying Vauxhall electric cars will dodge the tax changes, which can result in significantly higher annual costs for drivers of new vehicles.
Previously, BEVs were exempt from Vehicle Excise Duty (aka Road Tax). However, those costing less than £40,000 which are registered after 1 April will now pay a first-year rate of £10 until 2029 – and those priced over the threshold will pay an annual £425 ‘Expensive Car Supplement’ for the first five years of ownership, something that is typically applied to luxury vehicles. Meanwhile, EVs already registered between 1 April 2017 and 31 March 2025 will pay the same standard annual rate of road tax as other motorists – £195 per year. Hybrids will no longer qualify for a discount.
Vehicle Excise Duty (VED) is based on either engine size, or fuel type and carbon dioxide emissions, depending on when they are first registered. So, drivers of BEVs will still be liable for less than the driver of an ICE vehicle.
Vauxhall has said that the threshold changes ‘penalise’ people from transitioning to EVs at a time when adoption is rising. Eurig Druce, MD for Vauxhall, said: “With the average price of an EV in the UK at around £48,000, this new tax means that customers buying some of the more attainable electric cars on the market are now being penalised whilst at the same time we are trying to move as many British motorists to electric as quickly as possible.”
The change to the rules, while costing EV drivers more than before, has had the knock-on effect of reducing the price of new BEVs – with automakers keen to keep their vehicles attractive and cost-effective by pricing them under the threshold. For example, the freshly announced Abarth 600e is priced at £36,975 for the standard model and £39,875 for the premium model, which the manufacturer says is to ensure drivers don’t pay extra VED.
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