Latest news with #ChrisRosamond
Yahoo
05-04-2025
- Automotive
- Yahoo
Spain pays drivers £8,500 to go electric... as Labour's £3,000 tax kicks in
Spain has reintroduced £8,500 electric car grants in the same week that Labour brought in 'unfair' tax increases on Britain's battery-powered vehicles. New electric vehicle (EV) drivers in Britain now face paying up to £3,110 in tax bills during the first six years of ownership. All electric cars are liable for vehicle excise duty (VED), while models worth more than £40,000 come with an added £425 charge payable annually between the second and sixth years of a car's lifespan. Last week's hefty tax increase – which experts fear will hamper EV uptake – is in stark contrast to subsidies introduced in Spain. Spaniards can now benefit from up to €7,000 in aid if they scrap a petrol or diesel-powered car older than 10 years. The grant, which is capped at €5,500 if there is no car exchange, comes in addition to a €3,000 income tax deduction if the new car costs less than €45,000. The maximum potential savings on buying a new EV stand at €10,000 (£8,500). A previous subsidy scheme came to an end in December, but it has now been brought back to life. Britain, meanwhile, has not offered an electric car grant since 2022 when the Tories ended a £1,500 scheme nearly a year before the industry expected. Standard annual car tax, which now costs £195 for zero-emission cars, is also cheaper in Spain. EVs also benefit from a 75pc discount in major cities such as Madrid, Barcelona and Valencia. The Spanish government hopes its relaunched subsidy scheme, which will run until December at a cost of €400m, will boost EV uptake. Last year, 134,000 were sold in the country, accounting for 11.4pc of total car sales. In Britain, 19.6pc of sales were EVs yet the numbers were heavily skewed by fleet sales, which comprised two thirds of the sales. There are fears the new tax bills for electric cars will deter potential buyers. Fewer than one in four drivers intend to buy an EV in the next three years, according to the Society of Motor Manufacturers and Traders. The £425-a-year expensive car supplement, which kicks in when a car has a list price of more than £40,000, will impact the majority of drivers thinking of going electric. Vauxhall lowered the price of its Astra Sports Tourer and Grandland electric cars to come in below the threshold, but most new EVs top £40,000. Chris Rosamond, of Auto Express, said: 'Levying what is basically a tax set on petrol cars eight years ago on to EVs today is unfair, especially when you consider the large sums involved. 'With private EV uptake already struggling and cost being one of the main deterrents for potential buyers, this change risks slowing adoption at a critical time. The Government should be supporting drivers in making the switch to EVs, not penalising them.' John Cassidy, of Close Brothers Motor Finance, said: 'The Government's decision to apply VED to EVs only adds to cost concerns which are piling up for motorists, and adds further doubt over the proposed 2030 ban on new petrol and diesel vehicles – with 78pc of motor dealers already lacking confidence that this will go ahead.' In the Budget, Labour conceded that the expensive car tax has 'disproportionate impact' on EVs and said it would 'consider raising the threshold for zero-emission cars only at a future fiscal event'. Rachel Reeves, the chancellor, however, did not mention electric cars in her Spring Statement. A Treasury spokesman said: 'We're investing over £2.3bn to help industry and consumers make a supported switch to EVs, helping deliver our Plan for Change by kickstarting growth and productivity across the UK while helping tackle climate change. 'Our approach ensures fiscal stability while providing incentives through the tax system, such as freezing VED first-year rates (£10) for EVs to encourage the transition to electric and zero-emission vehicles.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
05-04-2025
- Automotive
- Telegraph
Spain pays drivers £8,500 to go electric... as Labour's £3,000 tax kicks in
Spain has reintroduced £8,500 electric car grants in the same week that Labour brought in 'unfair' tax increases on Britain's battery-powered vehicles. New electric vehicle (EV) drivers in Britain now face paying up to £3,110 in tax bills during the first six years of ownership. All electric cars are liable for vehicle excise duty (VED), while models worth more than £40,000 come with an added £425 charge payable annually between the second and sixth years of a car's lifespan. Last week's hefty tax increase – which experts fear will hamper EV uptake – is in stark contrast to subsidies introduced in Spain. Spaniards can now benefit from up to €7,000 in aid if they scrap a petrol or diesel-powered car older than 10 years. The grant, which is capped at €5,500 if there is no car exchange, comes in addition to a €3,000 income tax deduction if the new car costs less than €45,000. The maximum potential savings on buying a new EV stand at €10,000 (£8,500). A previous subsidy scheme came to an end in December, but it has now been brought back to life. Britain, meanwhile, has not offered an electric car grant since 2022 when the Tories ended a £1,500 scheme nearly a year before the industry expected. Standard annual car tax, which now costs £195 for zero-emission cars, is also cheaper in Spain. EVs also benefit from a 75pc discount in major cities such as Madrid, Barcelona and Valencia. The Spanish government hopes its relaunched subsidy scheme, which will run until December at a cost of €400m, will boost EV uptake. Last year, 134,000 were sold in the country, accounting for 11.4pc of total car sales. In Britain, 19.6pc of sales were EVs yet the numbers were heavily skewed by fleet sales, which comprised two thirds of the sales. There are fears the new tax bills for electric cars will deter potential buyers. Fewer than one in four drivers intend to buy an EV in the next three years, according to the Society of Motor Manufacturers and Traders. The £425-a-year expensive car supplement, which kicks in when a car has a list price of more than £40,000, will impact the majority of drivers thinking of going electric. Vauxhall lowered the price of its Astra Sports Tourer and Grandland electric cars to come in below the threshold, but most new EVs top £40,000. Chris Rosamond, of Auto Express, said: 'Levying what is basically a tax set on petrol cars eight years ago on to EVs today is unfair, especially when you consider the large sums involved. 'With private EV uptake already struggling and cost being one of the main deterrents for potential buyers, this change risks slowing adoption at a critical time. The Government should be supporting drivers in making the switch to EVs, not penalising them.' John Cassidy, of Close Brothers Motor Finance, said: 'The Government's decision to apply VED to EVs only adds to cost concerns which are piling up for motorists, and adds further doubt over the proposed 2030 ban on new petrol and diesel vehicles – with 78pc of motor dealers already lacking confidence that this will go ahead.' In the Budget, Labour conceded that the expensive car tax has 'disproportionate impact' on EVs and said it would 'consider raising the threshold for zero-emission cars only at a future fiscal event'. Rachel Reeves, the chancellor, however, did not mention electric cars in her Spring Statement. A Treasury spokesman said: 'We're investing over £2.3bn to help industry and consumers make a supported switch to EVs, helping deliver our Plan for Change by kickstarting growth and productivity across the UK while helping tackle climate change. 'Our approach ensures fiscal stability while providing incentives through the tax system, such as freezing VED first-year rates (£10) for EVs to encourage the transition to electric and zero-emission vehicles.'
Telegraph
01-04-2025
- Automotive
- Telegraph
Labour car tax raid to drag Renault Scenic into ‘luxury EV' bracket
Labour's car tax raid is set to drag commonplace electric vehicles (EVs) such as the Renault Scenic into the 'luxury car' bracket and cost motorists thousands of pounds a year. All new EVs sold for more than £40,000 are subject to the ' expensive car supplement ' to vehicle excise duty (VED) after tax changes announced by Rachel Reeves, the Chancellor. Electric cars were previously exempt from VED because of their low-emission status compared with conventional petrol and diesel vehicles. The changes mean a typical electrically-powered estate car such as the Renault Scenic, advertised by some car dealers at just under £41,000 on Tuesday, will be caught by the new tax. It comes after the car industry recorded 12 consecutive months of falling sales, factory closures and thousands of resulting job losses. Experts said the extended VED rate is likely to apply to 70 per cent of all new EVs thanks to the vehicles' high price, which averaged £48,600 last year, according to figures from the Society of Motor Manufacturers and Traders (SMMT). Chris Rosamond, current affairs and features editor at Auto Express magazine, said: 'EV buyers – including those purchasing used EVs first registered after the same date – will face yet another financial hurdle as the so-called 'luxury car tax' exemption ends. Data obtained by Auto Express from the Driver and Vehicle Licensing Agency (DVLA) revealed that a third of all cars are already subject to what Mr Rosamond called 'this already excessive additional rate' of tax – and that it would affect up to 70 per cent of new EVs. Ginny Buckley, chief executive of electric car advice website Electrifying, said: 'The Government's failure to update the outdated £40,000 luxury car tax threshold is yet another sign of poor leadership in the transition to electric vehicles. 'Drivers are being encouraged to go electric, yet face senseless barriers at every turn. 'In 2024, just 24.1 per cent of petrol and diesel cars sold exceeded £40,000 – compared with over 70 per cent of EVs. This means that many family-sized electric cars could be subject to a tax originally intended for luxury vehicles, and family drivers could end up paying thousands of pounds extra over six years.' Mike Hawes, the SMMT's chief executive, said in March: 'These are worrying times for UK vehicle makers with car production falling for 12 months in a row, rising trade tensions and weak demand. 'It was disappointing, therefore, to hear a Spring Statement that did nothing to alleviate the pressure on manufacturers and, moreover, confirms the introduction next month of additional fiscal measures which will actually dissuade consumers from investing.' Since the so-called zero emission vehicle mandate was introduced by Kemi Badenoch, the then-business secretary, in January 2024, car sales have steadily fallen. Green car enthusiasts have claimed the mandate is not to blame for the damage to the automotive sector, pointing to separate SMMT figures showing that EV sales have risen even as the overall market has shrunk. A spokesman for the Treasury said: 'We're investing over £2.3 billion to help industry and consumers make a supported switch to EVs, helping deliver our Plan for Change by kick-starting growth and productivity across the UK while helping tackle climate change. 'Our approach ensures fiscal stability while providing incentives through the tax system such as freezing vehicle excise duty first year rates for EVs to encourage the transition to electric and zero emission vehicles.'
