Measure

Vehicle Excise Duty rates and Heavy Goods Vehicle levy

The measure

Vehicle Excise Duty (VED) rates for cars, vans and motorcycles will increase in line with the Retail Price Index (RPI).

VED for Heavy Goods Vehicles (HGVs) will be frozen for 2022/2023, and the HGV Levy will be suspended for a further 12 months.  

 

Who will be affected?

Owners and operators of vehicles that fall under the VED or HGV Levy schemes.

 

When will the measure come into effect?

For cars, vans and motorcycles, changes will apply from 1 April 2022.

The government will continue to freeze HGV VED for 2022/23 and suspend the HGV Levy for a further 12 months from 1 August 2022.

Our view

The general increase in the VED rate for cars, vans and motorcycles is as expected.

The government cites its support for the haulage sector and pandemic recovery efforts, amidst supply chain disruption, as the reason behind the freeze on HGV VED rates and further suspension of the HGV Levy.