How much you pay depends on a number of different factors, most notably when the car was registered, plus either its engine size or CO2 emissions.
Unfortunately, taxing a vehicle in the UK is anything but simple, which is why we’ve condensed the ins and outs into one handy guide.
Vehicle Excise Duty (VED) – also known as vehicle tax, car tax or road tax – is essentially a tax for using a vehicle on public roads.
It was introduced in 1937 and replaced the old system of road tax, which traces its roots back to the taxation of Hackney Carriages in the 17th century.
The tax disc was introduced in 1921 and, until 1974, car taxation was handled by local authorities.
Then, in 1974, the DVLC (Driver and Licensing Vehicle Centre) was established, with an office in Swansea handling all vehicle and driver registration issues. The DVLC later became the DVLA (Driver and Vehicle Licensing Agency).
Each year, the DVLA collects £5.6 billion a year in Vehicle Excise Duty, but not all of this is spent on road improvements and infrastructure.
In fact, VED is grouped in with other forms of tax, meaning the income from your road tax is just as likely to be spent on education or healthcare as it is on roads.
