Chancellor’s 2024 Autumn Budget
Rachel Reeves, the new Chancellor of the Exchequer, recently unveiled her 2024 Autumn Budget. Here’s a summary of the primary changes affecting drivers.
Fuel Duty
In an unexpected decision, fuel duty will remain unchanged for at least another year, keeping the 5p duty cut from 2022 in place. Without this freeze, fuel prices would have risen by an additional 7p per litre starting April 1, 2025.
Road Tax (Vehicle Excise Duty, or VED)
Substantial increases are coming to VED for new cars starting April 1, 2025. These measures aim to encourage zero-emission vehicle purchases by widening the tax differences among electric, hybrid, and internal combustion engine (ICE) vehicles.
The most notable change is a tenfold rise in first-year VED for cars emitting 1-50g/km of CO2, including many hybrids. These rates will jump from £10 (or zero for hybrids) to £110. Cars emitting 51-75g/km will see their first-year VED increase from £30 (or £20 for hybrids) to £135. All other rates will also double, meaning an extra £220 in the first-year tax for a VW Golf 1.5 TSI, while a new BMW X5 M60i will see a £2,745 increase.
Infrastructure and Industry Support
The budget includes a £500 million increase in road maintenance funding starting in April 2025, aiming to repair an additional million potholes each year. In addition, £200 million will be allocated to expand electric vehicle (EV) charging infrastructure across England.
Fuel Price Transparency
The government has committed to launching a ‘Pump Watch’ fuel price monitoring scheme by late 2025. This initiative will require mandatory fuel price publication to enhance transparency and ensure that wholesale price reductions reach consumers.