Road Tax (VED) benefits of lower emissions will shape price of used cars in future

Thinking ahead when buying your next car could help keep your motoring affordable.In the last Budget Chancellor Alistair Darling laid the latest Treasury delayed action fuse , by announcing new rules for Vehicle Excise Duty to explode into effect next year. You are now looking at more CO2 emission-sensitive rates allocated to 13 Bands, from the current seven, classified from A-M. Starting with Band A for the sub-100g/km emitting cars (at no charge, as before ) through to Band M for the highest polluters above 255 g/km attracting a hefty £440 cost per annum. Where your car falls in the CO2 ranges will therefore determine what you pay, and as your car is one of the heftiest capital cost items for your budget planning well ahead will pay-off.

The seven current Bands for petrol and diesel cars- g/km CO2 range and tax rate-are:

A 100 or less £0
B 101-120 £35
C 121-150 £120
D 151-165 £145
E 166-185 £170
F 186-225 £210
G Over 225 £400

You can expect car guides to be quoting tax bands and rates in future. At low emission cars,we will also be adding the current tax band when quoting a CO2 rating for any particular car featured here. The publishers of the Black Book,CAP, say they have intoduced CO2 figures in the Black Book because they believe VED rates will become as influential on consumer choice as fuel economy and insurance costs. You can look up CAP on their website here.

PS We are not going to able to take our eye of this one! The Treasury suddenly announced (on the 29 April 2008) that it was abolishing an existing VED exemption on higher road tax rates for vehicles emitting more than 225g of CO2 per kilometre registered between March 2001 and March 2006. Clearly, there could be other 'tweaks'- we will never advocate a change merely to raise extra tax in such a stealthy manner from people who made their vehicle choices years ago, when the low emission options did not exist. You will need to watch out over the coming months. We will try to help you achieve affordable and greener motoring.