Rachel Reeves confirms £760 charge for drivers

 Some motorists are set to pay £760 to use the roads in 2026 after a new car tax charge implemented by Rachel Reeves. New Vehicle Excise Duty (VED) tax bands came into effect from April 1, 2026 with petrol, diesel and electric car owners all hit with new rates.

Prices increase in line with Retail Price Index (RPI) inflation every spring, with 2026 no different. The Chancellor is responsible for setting VED tax bands, with HMRC confirming increases late last year. Almost all vehicles will need to pay, with prices massively varying depending on the make and model of each car.

One set of road users will see fees rise by £25, with bills hitting £760 per annum in a hefty blow. Cars registered between 2001 and 2017 pay VED rates based on their car's overall emissions, with models placed into one of 13 tax bands.

Cars emitting between 226 and 255g/km of CO2 paid £735 to get behind the wheel before April, with these fees now rising to £760. However, it isn't the highest rise, with cars emitting over 255g/km of Co2 paying £30 more with charges up from £760 to £790 per annum.

Shahzad Shand, host of YouTube channel @BrownCarGuy, stressed that cars registered between 2001 and 2017 were being "treated harshest" of all. He called out the new fees, arguing that officials needed to review the "deeply unfair" rates.

He said: "These are the cars that arguably are treated harshest of all because they fit under a completely different VED regime, one based purely on official CO2 emissions figures from a time when nobody really imagined that those numbers would still matter quite this much."

Shahzad added: "This is a segment they really need to look at again. At the higher end these rates don't just feel harsh, they feel deeply unfair."

Motorists falling into car tax bands I, J, K have been hit with increases of £15 per year. Meanwhile, vehicles in Bands G and H are being charged £10 more to use the roads, with models in Bands E and F paying £5 more.

However, lower-polluting models in Bands A, B and C are not set to pay more, with fees remaining the same as in the last tax year.