If you want to pay less road tax, get a clean van

Running a cleaner van could lead to paying less road tax in the future, as Chancellor Philip Hammond announced that he will look into the possibility of reducing Vehicle Excise Duty (VED) for low-emission vans.

The announcement came in the Spring Statement in March, and has been broadly welcomed by businesses and the fleet industry.

Under the current system, Euro6 compliant vans (under 3.5t) pay £250, while Euro4 and Euro5 vehicles are charged a flat rate of £140 a year.

There’s no distinction between CO2 and NOx gasses for vans, with all paying the same rate. However, this could change as a result of the Chancellor’s consultation.

Full details of the nature and scope of the consultation are yet to be published but have been promised in the coming months by the Chancellor.

The move to launch the consultation is certainly welcome by RAC Business if it results in savings for small business fleet costs.

RAC head of roads policy, Nicholas Lyes, said he was looking forward to seeing more detail on the chancellor's plan for vans, but also feels there is much more to do to tackle the state of the roads.

He said:

“The announcement that the Chancellor will look at the possibility of reducing VED for businesses that buy cleaner vans is very welcome and we look forward to seeing more detail on this.

“But motorists and business drivers will be very disappointed that the Chancellor hasn’t addressed the issue of the condition of local roads in his Spring Statement.

“Put bluntly, before the cold snap the condition of many local roads was on a knife edge with many councils struggling to fix our roads properly. But now, as a result of the ‘beast from the East’ some local roads will have deteriorated even further, possibly to the point that they represent a serious risk to the safety of users.

“Figures from the RAC reveal that pothole-related breakdowns soared in the first week of March following the bitterly cold spell the country experienced. Our patrols attended some 218 call-outs per day on average between 4th March and 6th March, a rise of 110% on the period in the run-up to the cold spell.

“It’s disappointing that emergency funding has not been made available, but it’s a matter of urgency that the Government starts to look at the issue from a long-term point of view. This means that a funding strategy to address both prevention and cure, and certainty for local authorities so they are able to plan ahead.”


You could also save by taking out Van Breakdown cover with the RAC.

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