For most UK drivers, road tax is an annual cost that can range from £0 for electric vehicles to over £2,600 for the highest-emitting cars. Here is a complete summary of what UK drivers pay and why.
The Most Common Road Tax Cost
The most common annual road tax cost is the standard rate of £190 per year for petrol and diesel cars emitting 131-150g/km CO2. This applies to the majority of cars on UK roads — mid-sized family cars, SUVs, and most vehicles in the most popular segment. Cars emitting 121-130g/km pay slightly less at around £155-£180 per year.
Electric Vehicle Tax: £0
Electric vehicles with zero CO2 emissions pay £0 in road tax, making them the cheapest category. This applies in every year of ownership — there is no scheduled end to this exemption for currently registered vehicles. With approximately 1 million EVs now on UK roads, the VED revenue lost to EVs is growing but remains a small fraction of total VED collection.
High-Emitter Road Tax
Cars emitting over 255g/km CO2 — typically high-performance sports cars, large luxury SUVs, and some performance diesels — pay the maximum first-year rate of £2,605. In subsequent years, they pay £245 per year (or £245 plus the £355 additional rate if the list price exceeds £40,000). Over five years, a high-emitter can pay £7,000-£9,000 in road tax alone.
Average Road Tax Per Driver
The average annual road tax per driver is approximately £160-£170, reflecting the mix of standard-rate cars and the large number of lower-emitting vehicles on the road. This average does not account for EVs pulling the average down significantly — among petrol and diesel car owners, the average is closer to £185 per year.
Road Tax Revenue
Total VED revenue collected by HM Treasury is approximately £7 billion per year. This figure has been relatively stable despite the growth of EVs, because the increasing number of vehicles on the road offsets the revenue lost to zero-emission exemptions. Fuel duty — a separate tax — raises approximately £26 billion annually from petrol and diesel sales.
Where the Money Goes
VED revenue goes to the Treasury's general consolidated fund, not directly to roads. Roads are funded through the Department for Transport's separate budget allocation of approximately £10 billion per year for national roads and £3 billion for local roads. This means road tax drivers pay approximately £7 billion in VED but receive around £13 billion in road infrastructure spending — a subsidy from general taxation to road users.