# Vehicle Excise Duty, or "road tax" url: https://whereyourmoneygoes.co.uk/vehicle-excise-duty/ updated: 29 September 2026 licence: Our words, analysis, charts and derived calculations: CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/), credit [Tekstak Ltd](https://tek-stak.co.uk). Figures: each source's own licence, listed under Sources. publisher: [Tekstak Ltd](https://tek-stak.co.uk) # Vehicle Excise Duty, or "road tax" Last updated 29 September 2026. Figures refresh every night. [How each figure is worked out](/methodology/). **An annual charge for keeping a vehicle on a public road, set by emissions for newer cars and by engine size for the oldest.** Every registered keeper of a vehicle used or kept on a public road, including electric vehicles since April 2025. ## Key figures - £200Standard rate a year, most cars Plus £440 on cars over £40,000 - 42,897,084Licensed vehicles ▲ As of 30 June 2026 - 2,016,968Battery electric cars, paying since April 2025 ▲ As of 30 June 2026 - 7,019,516Declared off the road, so untaxed ▲ As of 30 June 2026 Source: [Department for Transport](https://www.gov.uk/government/statistical-data-sets/vehicle-licensing-statistics-data-tables). ## What is the short version? - **A three-year-old petrol car with a £45,000 list price:** The supplement more than triples the bill, and it is based on the price when the car was new, not what it is worth now. - **Latest change, 2028:** A per-mile charge for electric vehicles is due to begin, on top of VED. - **Where it goes:** The National Roads Fund, in England only. - **The argument:** Easy to enforce: a vehicle is registered, so non-payment is visible; against that, it bears almost no relation to how much you actually drive. ## How many vehicles is it charged on? 42,897,084 Licensed vehicles, United Kingdom ▲ Figure as of 30 June 2026. Source: [Department for Transport](https://www.gov.uk/government/statistical-data-sets/vehicle-licensing-statistics-data-tables). 34,888,140 Licensed cars ▲ Figure as of 30 June 2026. Source: [Department for Transport](https://www.gov.uk/government/statistical-data-sets/vehicle-licensing-statistics-data-tables). 2,016,968 Battery electric cars ▲ Figure as of 30 June 2026. Source: [Department for Transport](https://www.gov.uk/government/statistical-data-sets/vehicle-licensing-statistics-data-tables). 7,019,516 Declared off the road, so untaxed ▲ Figure as of 30 June 2026. Source: [Department for Transport](https://www.gov.uk/government/statistical-data-sets/vehicle-licensing-statistics-data-tables). Battery electric cars are 5.8% of the cars on the road. They paid no vehicle excise duty until April 2025 and pay it now, which is why the number matters to the total as well as to the owner. | Type | Vehicles | | --- | --- | | Cars | 34,888,140 | | Light goods vehicles | 4,958,081 | | Motorcycles | 1,485,895 | | Other vehicles | 881,875 | | Heavy goods vehicles | 539,513 | | Buses and coaches | 143,580 | Figure as of 30 June 2026. Source: [Department for Transport](https://www.gov.uk/government/statistical-data-sets/vehicle-licensing-statistics-data-tables). Vehicles declared off the road under a Statutory Off Road Notification are not taxed and not insured. They are counted separately here rather than netted off, because a vehicle can move between the two in a year. ## How does it work? Almost everyone calls it road tax. It has not been road tax since 1937, and the distinction is the single most argued-about thing about it. What you pay depends entirely on when the car was registered. Cars registered from April 2017 pay a high first-year rate based on CO2, then a flat standard rate every year after. Cars registered between 2001 and 2017 pay a rate set by their CO2 band for life, which is why some older low-emission cars still pay nothing. Cars registered before 2001 pay by engine size. On top of the standard rate, cars with a list price above £40,000 when new pay an expensive car supplement for five years. The threshold is higher for electric cars, but it is not indexed, so it catches more cars each year as prices rise. | What | A year | | --- | --- | | Standard rate, from the second year | £200 | | Expensive car supplement, list price over £40,000 (£50,000 for zero-emission cars), years 2 to 6 | +£440 | | Paying monthly by Direct Debit | £210 a year | Rates: [GOV.UK, Vehicle tax rate tables](https://www.gov.uk/vehicle-tax-rate-tables). Checked by hand 22 September 2026. Electric vehicles paid nothing until April 2025 and now pay the standard rate like everything else. From 2028 they will also pay a per-mile charge on top. ### A three-year-old petrol car with a £45,000 list price | Step | Amount | Note | | --- | --- | --- | | Standard rateDetails | £200 | | | | | | | Expensive car supplementDetails | £440 | because the list price was over £40,000 | | Notebecause the list price was over £40,000 | | | | Total for the yearDetails | £640 | | | | | | | The same car once it is six years oldDetails | £200 | the supplement runs for five years only | | Notethe supplement runs for five years only | | | **The supplement more than triples the bill, and it is based on the price when the car was new, not what it is worth now.** ## How has it changed? How it got here, and why each change was made: - **1888**The first duty on mechanically propelled vehicles. - **1909**The Road Fund is created and vehicle duty is hypothecated to it. This is the origin of the phrase road tax, and the only period when it was true. - **1937**Churchill abolishes the Road Fund link, having argued that hypothecation gave motorists a false sense of owning the roads. Vehicle duty goes into general taxation. - **2001**Rates start to vary by CO2 emissions rather than engine size, to push buyers towards cleaner cars. - **2017**The system is redesigned: a high first-year rate by CO2, then a flat standard rate, because CO2 banding had made most new cars exempt and revenue was falling. - **2018**The National Roads Fund is announced, hypothecating English VED to the strategic road network. A partial return to the 1909 idea. - **2025**Electric vehicles start paying, ending the exemption that had helped drive their adoption. - **2028**A per-mile charge for electric vehicles is due to begin, on top of VED. ## Where does the money go? **The National Roads Fund, in England only.** Partly true, and more than it was. Since 2018 English VED has been allocated to the National Roads Fund, which pays for the strategic road network: motorways and major A roads managed by National Highways. But it does not fund local roads, which is where most potholes are and which councils pay for out of general funds. VED also raises more than the fund spends. And Scotland, Wales and Northern Ireland get block-grant funding rather than their own share. So "road tax pays for the roads" is closer to true than it was in 1990, and still not a fair description of what most drivers experience. ## Does it change what people do? CO2-based banding worked, arguably too well. It shifted buyers so effectively towards low-emission cars that by the mid-2010s a large share of new cars paid nothing, and the 2017 redesign was needed to stop receipts collapsing. It is a clear case of a tax achieving its behavioural aim and undermining its revenue aim at the same time. [When a tax rise stops raising money](/when-tax-rises-lose-revenue/) looks at the cases where the effect has been large enough to move the revenue. ## What are the arguments? ### The case for taxing vehicles this way - Easy to enforce: a vehicle is registered, so non-payment is visible. - Emissions banding gave manufacturers a strong reason to cut CO2. - A flat standard rate is predictable and cheap to administer. - Charging electric vehicles keeps the base from disappearing as the fleet changes. ### The case against - It bears almost no relation to how much you actually drive. - The expensive car supplement is not indexed, so it catches ordinary family cars over time. - Cars registered before 2017 pay wildly different amounts for identical emissions today. - Calling it road tax while most of it does not fund local roads breeds justified cynicism. Both columns are set out as their strongest case, not as a preferred answer and a strawman. See [how this site handles contested questions](/neutrality/). ## Common questions What is road tax and does it pay for roads? An annual charge for keeping a vehicle on a public road, set by emissions for newer cars and by engine size for the oldest. Every registered keeper of a vehicle used or kept on a public road, including electric vehicles since April 2025.Where does vehicle excise duty, or "road tax" go? The National Roads Fund, in England only. Partly true, and more than it was. Since 2018 English VED has been allocated to the National Roads Fund, which pays for the strategic road network: motorways and major A roads managed by National Highways. But it does not fund local roads, which is where most potholes are and which councils pay for out of general funds. VED also raises more than the fund spends. And Scotland, Wales and Northern Ireland get block-grant funding rather than their own share. So "road tax pays for the roads" is closer to true than it was in 1990, and still not a fair description of what most drivers experience. ## Use this data The figures belong to the bodies that published them and are used under their terms, listed in [Sources for this page](#sources); most are Crown copyright under the Open Government Licence. Only our own words, analysis, charts and derived calculations are ours, published under [CC BY 4.0](https://creativecommons.org/licenses/by/4.0/): reuse them, including commercially, if you credit [Tekstak Ltd](https://tek-stak.co.uk) and link back to this page. ### Download - [Total HMRC receipts by financial year (CSV)](/data/receipts-total.csv) [JSON](/data/receipts-total.json) HM Revenue and Customs: [Open Government Licence v3.0](https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/) - [All data, field definitions and licences](/data/) ## Sources for this page | Source | Publisher | Figures as of | Updated | Licence | | --- | --- | --- | --- | --- | | [HMRC tax receipts and National Insurance contributions for the UK](https://www.gov.uk/government/statistics/hmrc-tax-and-nics-receipts-for-the-uk) | HM Revenue and Customs | the 2025–26 financial year | annual | [Open Government Licence v3.0](https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/) | | [Vehicle licensing statistics data tables](https://www.gov.uk/government/statistical-data-sets/vehicle-licensing-statistics-data-tables) | Department for Transport | 30 June 2026 | quarterly | [Open Government Licence v3.0](https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/) | Each source's figures are used under the licence shown. Our own words, analysis, charts and derived calculations are ours, under [CC BY 4.0](https://creativecommons.org/licenses/by/4.0/). ## Related pages - [Next in this section: Stealth taxes](https://whereyourmoneygoes.co.uk/stealth-taxes/) - [How much tax is in petrol?](https://whereyourmoneygoes.co.uk/tax-on-petrol/) - [What is the electric car pay-per-mile tax, and what happens to fuel duty?](https://whereyourmoneygoes.co.uk/ev-pay-per-mile-tax/) - [How much is a passport, a driving licence and an MOT, and where does the money go?](https://whereyourmoneygoes.co.uk/passport-driving-licence-and-mot-fees/) - [How much do ULEZ, Clean Air Zones and road tolls raise, and where does the money go?](https://whereyourmoneygoes.co.uk/clean-air-zones-and-road-charges/) ## More from this publisher - [UK tax calculators](https://howlongisit.co.uk) Published by [Tekstak Ltd](https://tek-stak.co.uk). Our words, analysis, charts and derived calculations: CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/), credit [Tekstak Ltd](https://tek-stak.co.uk). The figures belong to the publishers listed under Sources and are used under their licences. Figures last updated 29 September 2026.