The UK is set to introduce several key transport policy changes over the next two years, impacting fuel prices, taxation, electric vehicles, and road safety regulations. Here’s what you need to know:
1. Fuel Duty Freeze Continues
In the Autumn Budget, it was confirmed that the fuel duty freeze will remain in place, with the existing 5p discount extended through 2025 and 2026. This decision keeps fuel duty at 52.95p per litre for at least another two years.
Fuel duty directly impacts the cost of petrol and diesel, making it a significant factor in overall fuel prices for consumers. Higher duty increases costs at the pump, while freezes or cuts can provide financial relief.
2. Company Car Tax Rises
Company car drivers should prepare for changes to Benefit-in-Kind (BiK) tax rates starting in April 2025. BiK rates for all vehicles will increase by 1%, with electric vehicles rising from 2% to 3%. Higher-emission vehicles will see even larger increases, impacting costs for company car drivers across the board.
3. Electric Vehicles Lose Their Tax-Free Perk
From 1 April 2025, electric vehicles (EVs) will no longer be exempt from Vehicle Excise Duty (VED). Newly registered EVs will be subject to a £10 VED charge in the first year, increasing to £195 annually from the second year onwards. Additionally, EVs with a value exceeding £40,000 will incur an extra charge of £410 per year for five years under the expensive car supplement.
4. London Congestion Charge Exemptions Scrapped
Electric vehicle (EV) drivers are set to face another financial change as free city driving comes to an end. From 25 December 2025, all vehicles, including electric and hydrogen-powered models, will be required to pay the £15 London Congestion Charge. Previously, electric car owners could pay £10 to receive an exemption from the charge.
However, it’s worth noting that there’s no Congestion Charge from 25 December to 1 January, so this charge properly comes into effect from 2 January 2026.
5. New Fines for Non-Compliant EV Chargers
On a more positive note for EV drivers, charging infrastructure across the UK is set to improve. From 2025, EV charging providers will be required to meet new government standards for reliability, accessibility, and ease of payment. These standards aim to enhance the charging experience for EV drivers and ensure consistent access to reliable infrastructure nationwide. Providers failing to comply could face fines of up to £10,000 per charger.
6. New Fuel Finder Scheme
By the end of 2025, all petrol stations in the UK will be required to share real-time fuel prices through the new ‘Fuel Finder’ scheme. This initiative aims to help drivers identify the best places to fill up and save on fuel costs.
7. Mandatory HGV Permits in London
From 4 May 2025, all HGVs operating in Greater London will be required to hold a safety permit under Transport for London’s Direct Vision Standard (DVS). The permits, which are free of charge, assess a driver’s visibility of vulnerable road users, including cyclists and pedestrians. HGVs with limited visibility will need to be equipped with additional safety features, such as cameras and sensors, to meet the permit requirements.
8. Scotland’s 20mph Speed Limit
Scotland will roll out a nationwide default speed limit of 20mph in urban and residential areas in 2025. This change is designed to improve pedestrian and cyclist safety and reduce accident rates.
These upcoming policy changes will have widespread effects on drivers, businesses, and transport infrastructure. Whether you’re a company car driver, an electric vehicle owner, or a commuter in London or Scotland, it’s crucial to stay informed and prepare for these adjustments.