VAT, VED and fuel tax rises, plus cuts in road spending predicted

Today's emergency Budget is likely to hit motorists hard.

The Budget is being launched as the Conservative-Liberal coalition government puts plans in place to reduce the nation's £156 billion of debt.

Motorists are expected to be hit by a rise in the VAT rate from 17.5 to 20 per cent, raising the cost of new and used vehicles, servicing and fuel.

It has already been announced that the Department of Transport's budget will be reduced by £683 million. Exact details of where the cuts will be felt are unclear, but motorits are liklely to be hardest hits as road building and maintenance plans are shelved.

There is also speculation fuel tax will be raised, although the Conservatives campaigned for fairer fuel prices during the election. A future VED hike for the highest polluting vehicles has also been mooted.

Click back on later today to get confirmed details of announcements.

Join the debate


22 June 2010

The government spends money on road maintenance?!!! Which one, and where? I'd like to take a photograph of it. Just to show my kids.

PS: The greater the VAT, the bigger the Black Market.

22 June 2010

[quote Los Angeles]The government spends money on road maintenance?!!! Which one, and where? I'd like to take a photograph of it. Just to show my kids.[/quote]


My local council is even leaving potholes in busy A roads now. Speed bumps are crumbling and it's making them treacherous.

Re the VAT rise, I personally think it is a mistake. As a business owner who deals with both companies and individuals, I expect to see some backlash from individuals.

People look at the UK and say we have one of the lowest VAT rates in Europe, which is very true, but they tend to ignore the fact that we have a council tax twice as high as those other countries and a higher duty on fuel as well.

22 June 2010

We need more roads to get people moving again. And once we have a more efficient means to get around we'll have better business too.

Transportation isn't the only means to get the UK back on it's feet, but it's a major one.

22 June 2010

Why don't we wait and see before we panic.

My council have pretty much repaired all of our pot holes (caused loads of traffic in the process)

As far as VAT goes, the increase will make a small difference, such as £300 on a £15k car. Quite frankly Fords price increases have been far greater than that and they are still the top seller in the UK. Alternatively we can all keep things as they are and next year we can watch our whole country go to the dogs like Greece who's national debt spirals out of control due to the crippling interest charges on a nation that can't afford to pays its bills.

22 June 2010

I've read in a number of places this morning that the talked-about 2.5% VAT rise is 'far from certain'...

22 June 2010

[quote MattDB]

Why don't we wait and see before we panic.


Because this is Britain - and that means the only news we're going to get is gloom & doom for the always.

Add your comment

Log in or register to post comments

Find an Autocar car review

Driven this week

  • Car review
    23 September 2016
    Aston kicks off its ‘second century plan’ with an all-new turbo V12 grand tourer
  • Ford Ka+ 1.2 Ti-VCT 85
    First Drive
    22 September 2016
    A rounded, refined and well-sorted bargain supermini – once you’re used to the confusing role redefinition imposed on the once-cheeky Ka
  •  Maserati Ghibli Diesel
    First Drive
    22 September 2016
    Maserati releases another range of updates for its range best seller, the Ghibli. We've driven the diesel version, but there's little improvement on before
  • Tipo Front
    First Drive
    21 September 2016
    New Fiat Tipo offers impressive space and practicality for a reasonable price. We try the 1.6 diesel on the demanding roads of North Wales
  • Seat Ateca 1.4 TSI 150
    First Drive
    20 September 2016
    The Seat Ateca 1.4 TSI 150 makes perfect sense: it's spacious, tidy to drive for an SUV and cheap to run