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First of all, it's worth pointing out that the new rules only apply to newly registered vehicles. If a car was registered before April 1st 2017, it is still governed by the old rules on VED and will remain as such going forward.


Newly registered cars since April 1st 2017 are instead charged a rate of VED according to their carbon dioxide emissions, which means cars with lower emissions have a lower rate of VED.


This is only the case in the first year of the vehicle's registration - and from the second year onwards (which for these vehicles will begin on April 1st 2018) there is a fixed rate of VED.


In the first year, VED now ranges up to a potential £2,000 for the most polluting vehicles, with emissions in excess of 255g of CO2 per kilometre.


The sliding scale ranges down to £500 for vehicles that produce 151-170g CO2/km, £100 for those with emissions of 76-90g and £0 for zero-emission vehicles.


From the second year, regardless of the amount of CO2 produced, all vehicles with emissions of more than 0g are charged a standard fixed rate of VED of £140, while zero emission vehicles remain at £0 for the second and subsequent years.


There is one final rule, which means that cars valued at over £40,000 incur an extra £310 VED supplement for five years - potentially making them significantly more expensive than a vehicle listed at £39,999.99 over that period, especially if they have relatively high emissions.


In its economic impact assessment before introducing the new system, the government predicted that the new VED rules would have a small effect on inflation, possibly adding to the rate of price growth; however, on an individual basis nobody will pay more for a vehicle they already own.


As for new vehicles, the average rate of VED under the old system was £166 and under the new rules, for most motorists the fixed annual rate of £140 will apply; the supplement for vehicles worth more than £40,000 is only likely to be paid by households with a relatively high income.


Importantly for those in the motor trade, the impact assessment cites no significant negative effects on businesses - there is of course a one-off need to adjust to the new rules, but in the long term the administrative processes involved in registering a new vehicle have not changed, and neither businesses nor drivers should see an increase in admin costs.