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The New “Showroom Tax”

Let’s face it, by now it must be tricky for the government to come up with new and ingenious ways to tax the motorist. But bless them, they have managed to do it again.

Ladies and Gentlemen, as of 1 April, let me introduce you to the new Showroom Tax.

BUT I DON’T OWN A SHOWROOM!

Let me be very clear – THIS IS A ONE-TIME TAX PAYABLE ONLY ON BRAND-NEW CARS and so it doesn’t affect used car purchases. Plus, it only really applies to the more polluting cars.

It is structured so that your first year’s road tax is potentially more expensive than any subsequent years.

And you may not even notice it as the dealer will just add it on to your invoice and pay it for you, in the same way as they do with the VAT (lest anyone forgets that 17.5% of a new car’s cost already goes to fund our great nation).

HOW MUCH MORE IS THIS GOING TO COST ME?

So that the government can make it seem as if there are some environmental reasons behind this, the size of the tax is related to how environmentally friendly the car is (based on the official CO2 output):

CO2 Output Normal
road tax*
First year
including
Showroom Tax
Up to 100g/km £0 £0
101-110g/km £20 £0
111-120g/km £30 £0
121-130g/km £90 £0
131-140g/km £110 £110
141-150g/km £125 £125
151-165g/km £155 £155
166-175g/km £180 £250
176-185g/km £200 £300
186-200g/km £235 £425
201-225g/km £245 £550
226-255g/km £425 £750
Over 255g/km £435 £950

(*Please note that cars registered before 1 March 2001 have a different road tax cost structure.)

To be fair, all this means that very low-emission cars will have less tax to pay for the first year… a whole £20 to £90 worth!

WHY IS THIS POINTLESS?

Largely because no-one is going to stop buying 4x4s because of this tax. If you are shelling out £52,000 for a Range Rover Sport, an additional £515 isn’t going to make you swap to a Toyota Prius hybrid.

However, what really makes no sense to me is that last year the government said, “We understand the new car market is struggling, so we will introduce the Scrappage Scheme to help.” But this new tax is a complete U-turn. Although the government doesn’t necessarily seem to be discouraging people from buying new cars in general, they do appear to be singling out the sort of new cars that the British have always been good at producing… expensive gas guzzling ones.

See every-mod-y later!

Ashley Winston
(Founder & Owner)

At Palmdale we specialise in taking all the hassle out of the car buying process:

 

  • YOU tell us exactly what car you want
  • WE search for every available car in the UK that meets your description
  • WE negotiate with the seller
  • WE make sure that the car is perfect
  • WE collect the car and bring it to your door
  • YOU enjoy your new wheels for many years to come

These newsletters are our attempt to teach you everything we know about car buying; however, if you would like us to find and buy your next car for you, all you have to do is ask!