Luxury Car Tax UK Explained
The Expensive Car Supplement (ECS), also known as luxury car tax, applies to new cars over £40,000, with extra annual costs. Written by Amrit Kaur.
How the £40k Rule Works
A change in Vehicle Excise Duty (VED) in April 2025 introduced major changes to car tax, including the loss of exemption for electric vehicles (EVs) over £40,000. The same rule has applied to non-EVs since April 2017.
Author's summary: Luxury car tax explained for UK car buyers.
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