What is Vehicle Excise Duty
Vehicle Excise Duty (VED), still widely called road tax, is a tax you pay to keep a vehicle registered for use on public roads. It is collected by the DVLA, not HMRC, and the amount depends on the vehicle's CO2 emissions, fuel type, and when it was first registered. Since 2017, most new cars pay a flat standard rate after the first year, though the figure changes at each Budget: check GOV.UK for current rates.
If you want to see how your own tax contributions are calculated and where your money goes each month, you can use our free Income Tax Calculator.
The term "road tax" is misleading. The money does not go into a ring-fenced pot for road spending. It goes straight into the Treasury's general fund, alongside income tax, VAT and everything else.

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VED and fuel duty together bring in roughly £32 to £35 billion a year. None of it is earmarked for roads.
Road building and maintenance in England is funded through the Department for Transport's budget, set during spending reviews. The Treasury decides how much to allocate each year regardless of how much VED or fuel duty comes in. If VED revenue went up by 20% tomorrow, it would not mean 20% more spending on roads.
Local roads are maintained by councils, funded through council tax, central government grants, and whatever else they can find. The potholes on your street are a council responsibility, and councils have been under severe financial pressure for years: a big reason road surfaces have deteriorated badly in many areas.
Your situation may be slightly different. ask a question below ↓ and our editorial team will reply with our advice.
Why It Feels Like a Raw Deal
The comment that comes up most often from drivers is straightforward: if the money went directly to fixing potholes, people would pay it willingly. Instead, it disappears into general revenue and the roads still fall apart.
The RAC Foundation has pointed out repeatedly that motoring taxes bring in far more than the government spends on roads. Drivers pay around £35 billion a year in VED and fuel duty combined, while total public spending on roads is closer to £10 to £12 billion. The rest funds other things entirely.
This is how most taxes work. National Insurance does not only fund the NHS. Council tax does not only fund local services. But motoring taxes feel more directly connected to a visible public service, which is why the gap between payment and provision stands out.
What Has Changed in Recent Years
VED rates were restructured in April 2017. Before that, the amount was closely tied to your car's emissions, and very low-emission vehicles paid nothing. From 2017 onward, the first-year rate still varies by emissions, but from year two almost every car pays the same flat rate. Cars with a list price over £40,000 pay a supplement for five years on top.
Electric vehicles were exempt from VED until April 2025, when they became subject to the lowest first-year rate and then the standard rate from year two. This was announced in the 2022 Autumn Statement: as more drivers switch to electric, the Treasury cannot afford to lose the revenue. Hybrid vehicles pay according to their emissions band in the first year, then the standard rate like any other car.
Fuel duty has been frozen since 2011, with a temporary 5p cut introduced in 2022 and extended several times. Whether it stays frozen or gets raised is a recurring Budget question.
On top of VED and fuel duty, drivers in some areas pay congestion charges, clean air zone charges, or parking fees. The London Congestion Charge has run since 2003. Birmingham, Bath and Bristol have introduced clean air zones with daily charges for higher-emission vehicles. These are collected by local authorities, and the revenue is typically required to be reinvested in local transport.
VED does not pay for roads in any direct sense. It pays for whatever the government decides to spend money on. Roads are funded separately through departmental budgets and local authority allocations. Many drivers feel the government has not explained why motoring taxes are so much higher than the amount actually spent on roads, and that frustration is not going away.
If, however, it is just to keep some Quango going, I am averse to paying.
I await to hear your detailed response.
Damian
You need to show me that in paying this demand, what I am actually getting out of my spend, Your website makes no reference to these.
I look forwaqrd to hearing from you and will not settle your bill until I am satisfied that I am getting value for your demand!
Damian
My council seem to be closing off half the town every weekend for some event or other when there are numerous other places these events could be held.
As a car tax payer I assume this gives me the right to use any public highways if they decide to close them other than for a good motoring reason except for other than what I already mentioned does this give me the option of a refund for the roads on the days they are unavailable for use.
Obviously I can guess the answer but Just a thought. ??
The sooner car drivers realise they pay for the privilege of using a car and not for the roads on which they drive which are paid for by everyone -hence why they are called PUBLIC highways - the better we will all be.
What would be the outcome of having an accident because you were so distracted by the state of the road surface.
I think we should all stop paying road tax until it’s sorted.
We pay so much out in tax one way or another we have a right to expect something back for it.
On a different link on the same subject it stated that part of our council tax pays for the roads to be repaired. So where is the money going? Government need to start listening to the public that pay council tax and road tax for such services and their wages.
British roads are 3rd world condition and in the meantime, our vehicles are been ruined.
Yesterday I drove over two different potholes and could not swerve due to oncoming traffic. The potholes were approximately 20 inches wide and deep.
Are the councils paying the staff too much money????
Meanwhile people particularly on bicycles are being killed, vehicles are being damaged, and if proven is costing local councils a fortune.
Ultimatly the government is raking in millions of vehicle tax funds and clearly not re investing the money where it is needed.
I call that fraud.
Almost all the damage done to infrastructure is caused by vehicles. Same for pollution. Now let's say I don't drive and walk most places..on longer journeys I ride a push-bike. I am paying for roads indirectly, through general taxation. I am paying for all the damage and pollution I have no caused. Do I get a rebate? Does everyone else in the same position? Now compare that huge figure with how much more you think you are really paying than pedestrians and cyclists.
Even if I used an electric car, I am still causing damage. So in the future when electric cars become more popular we are still going to be in a similar position. If anything, I suggest everyone here stands together in holding the government to question over where this loss of revenue (from less pollution) is going to come from. A hike in general taxation, that's where, in my opinion. We are ALL going to get stung. Now add to this the state of public transport in this country..what is going to be done about that? Especially when this government insists on increasing the population by a factor of millions through one form or another. But if you want to keep fighting between yourselves then fine..just remember who you are all really fighting for (it's not you).
Before I leave my house I have to plan a route to try to avoid the ridiculous state of the roads in Huddersfield . I’m forever putting new ball joins and bushes on my vw van, of course we all know what’s happening to our hard earned road tax money it’s the dirty thieving government throwing champagne dinners and giving each other back handers , the roads in the centre of London are pothole free !! Shame on you fraudulent government scum!!
It's getting harder and harder to live what with ever rising car insurance aswell as extortionate prices for energy , fuel and food.
It's a disgrace, something needs done and all this reviewed. Now I'm not niave enough to think JC is the answer and no that's not Jesus Christ but the government needs to address this. lower council tax or road tax it's that simple.
This discussion is about tax however now I'm on my soapbox as a car driver who has been on the receiving end twice of bad cyclist, both jumping red lights, I would also call for cyclists over 16 to have at least third party insurance, the same as all road users. Cyclists have no financial liability at all with regards road use, or damage caused by accidents.
Other countries in Europe have superior road surfaces and I fail to understand why the vehicle excuse duty is NOT being used for the roads but instead to fund other areas not transport related. This is unacceptable and the funds should be used forthwith to repair and resurface roads to a reasonable standard.
Who pays for business and quality of life lost due to traffic jams?
Who pays for the damage caused to our lungs by pollution?
Those who complain about "cyclist" using the road, do you want me to get a car and take up more space and block your way? You could be grateful that either I don't have a car or if I do, I leave it home and use a gentler way of transport.
It's not all about money. If you drive, you take away other people's peace, space, fresh air, safety, etc. Children can't play outside anymore. You can't put a price on that!
If all our taxes are combined we pay in the region of 70% fro every £1 earned plus the hidden tax of inflation! which does not leave much for our subsistance.
It annoys me beyond measure that I have had to hammer out 4 dented steel rims in the past year as a result of potholes and with all the money the treasury recieves it baffles me that they do not have a clue how to allocate effectively for UK infrastructure which is clearly intentional.
A report in 2012 showed that government managed to waste £120 billion on rubbish like office furniture, flowers, redundant IT etc.
If my car would not be impounded or otherwise forcefully taken from me or I wouldnt be fined or imprisoned I would not pay tax at all in any shape or form because it is all a con and only serves to maintain the status quo.
I would gladly volunteer payment for local services that I use or might use though!
We clearly do not live in a free society since non payment of such valueless extortion are met with a responce that can only be described as coercive.
Big government or centralisation is a major contributor to why this does not work.
Government is a bloated, inefficient, old school, boys club that seeks not only to rob you and squander all your tax money but also to beguile you into offering gratitude for their intentional gross ineptitude.
I have no sympathy for fools who cannot see the wood for the trees.
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