VED tax changed on April 1st and now an Outlander PHEV owner will pay almost the same amount in VED as a new owner of a Range Rover SDV8 after the first year of ownership

Mitsubishi UK boss Lance Bradley has accused the government of not having “a clear and consistent plan” for electric vehicles.

Bradley cited the vagaries of the new Vehicle Excise Duty (VED) that came into force on 1 April and mean that some versions of the brand’s best-selling Outlander PHEV plug-in hybrid, which has CO2 emissions of 41g/km, now costs nearly the same in VED as a Range Rover SDV8, which emits 219kg/km of CO2.

The Mitsubishi had a VED rate of £10 in the first year of ownership, compared with the Range Rover’s £1200. However, for the ensuing five years, both vehicles will attract a £310 supplement on top of their VED rates because they cost more than £40,000.

An Outlander PHEV owner will pay £130 in VED, plus the £310 supplement, making £440 per year. The Range Rover will attract £140 in VED, making £450 when the £310 supplement is added.

“It’s poorly thought through,” said Bradley. “It’s not very difficult to have an EV policy, but the new VED charging is muddled.”

Bradley’s frustration is exacerbated by the fact that the new VED rates contradict the government’s own attempts to encourage the take-up of hybrid and electric cars. It continues to provide subsidies for electric and hybrid vehicles, with the Outlander PHEV qualifying for a £2500 grant.

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Comments
12

6 April 2017
He should consider reducing his prices. That sounds like a hefty price for a mid sized fourby. Just possibly they're bumping up the price because of the government subsidy...

Aussie Rob - a view from down under

6 April 2017
@AussieRob, if you look at UK car prices you'd notice that 40k is not much for a new car. This Mitsubishi is probably the cheapest hybrid SUV in its size or class.

The M boss is absolutely correct.

6 April 2017
Mitsi would only dream of getting $70k (AUD) for a car like that here. Though, admittedly, it wouldn't be a hybrid. They don't sell here. Audi, Toyota and even BMW tried and found so little interest, they withdrew them. Audi shifted 3 A3 e-trons in NSW over an 18 month period at a list of $72k. A dealer told me they were discounted below $50k before Audi pulled the plug. As it were...
Robbo

Aussie Rob - a view from down under

6 April 2017
It's all about raising money, that's all. If everyone bought electric cars tomorrow, they'd end the zero-tax, obviously! Basing it on CO2 emissions is absurd enough, but then basing it (also) on vehicle value says it all. It's like the London 'Congestion Charge'. It isn't about congestion, it's about bleeding money out of motorists. Like Stamp Duty on moving home. What's it for? Just a tax on you moving home!!!
Stamp Duty should only apply on homes you don't live in. It's the most disgusting tax there is. It would be nice if we had honest tax-raising here in the UK.

6 April 2017
The VED changes (another Osbourne mistake) make no sense and are in serious need of a rethink. The new VED rates turn years of government policy on their head, they do nothing to encourage uptake of efficient/low CO2/low emission vehicles and are clearly just a means to just fleece beleaguered motorists who, one way or another, end up picking up the tab. You don't have to tick many options these days to easily go over £40k and the weakness of the pound has made imported cars more expensive as well but no matter how efficient your car is (or how little you use) you're obligated to pay an exotbitant rate of VED for 5 years. Where's the fairness in a system that charges the owner of a sub £40k car less for emitting moderate levels of CO2 and other toxins on a daily basis and dramatically more for the owner of something expensive but efficient BMW i8 used twice a week? What has the cars value to do with efficiency or usage? Sorry but this VED policy is a massive backwards step and should be redrafted.

6 April 2017
"Slams"

Have I wandered onto the Huffington Post or The Sun websites by mistake?

6 April 2017
Big news, Car company boss complains when an economic advantage is taken away or reduced!...The new system is better than the one is replaces, but it was just another missed opportunity to scrap VED and just add a few pence to each litre of fuel.

tlb

6 April 2017
The frontpage today carries a different story about how there will but up to a £20 charge levied for diesels in major UK cities, and yet the new VED rules continue to make diesel attractive as they are STILL focussed on CO2.

Whilst I'm not convinced that a PHEV SUV is the best arguement against - It's absurd that you have the prime minister publicly stating we will have to support drivers in a move away from diesel when your tax policy is still offering incentives to buy them!

6 April 2017
'It would be nice if we had honest tax-raising here in the UK.'

We would need a new government for that to happen Brazzer.

6 April 2017
Mitsubishi "boss" is whining because the unfair tailwind they had is no more. Man up and tell to your mates in Japan to build up a better range of vehicles, not crap Mirages.

And your brand life is unlikely to become easyer, you had the NedCar factory for 10 years and look in what it ended.

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