Rachel Reeves has announced a hike in the threshold of the Expensive Car Supplement to support the uptake of electric vehicles.
In documents leaked prior to the Chancellor's Budget announcement, the Office for Budget Responsibility stated that changes would be made to the Expensive Car Supplement.
It states that the threshold of the ECS will be hiked from £40,000 to £50,000 in April 2026 at a cost of £500million in 2030-2031.
This charge is levied on motorists for five years once the vehicle is first registered, totalling £2,370 for a car purchased in 2025-2026.
This takes into account a hike to the rate of the Expensive Car Supplement at an average cost of £474 a year for five years.
This is higher than the current rate of £425 for all vehicles which cost more than £40,000.
Experts have consistently called for this change to be introduced to help motorists adopt electric vehicles and ditch petrol and diesel cars.
While electric vehicle prices are falling, they are oftentimes still more expensive than petrol and diesel counterparts.
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The Expensive Car Supplement applies to all vehicles with a list price of more than £40,000 | PAMORE TO FOLLOW...