What the Spring Statement 2025 Means for UK Motorists

The 2025 Spring Statement, delivered by Chancellor Rachel Reeves, didn’t introduce any major new tax changes for drivers—but that doesn’t mean motorists are off the hook.

Earlier policies are now coming into force. As such, some car owners across the UK will likely start to feel the pinch from April.

If you're wondering how the latest economic update affects your wallet as a motorist, here’s a breakdown of what you need to know.

Vehicle Excise Duty (VED): Higher Bills Ahead

While the Chancellor didn’t announce fresh tax hikes, existing changes to car tax—set out in the 2024 Autumn Budget—are about to kick in.

From April:

• Standard VED will rise from £190 to £195.
• First-year VED for electric vehicles (EVs) will no longer be zero—owners will pay £10.
• The lowest-emission cars lose their exemption, facing a minimum charge.
• The Expensive Car Supplement still applies to cars over £40,000—impacting many EVs with a £425 yearly fee.
• Hybrid and mild-hybrid vehicles lose their £10 annual discount.

This means that whether you drive electric, hybrid, or petrol, you're likely to pay more from this April.

Fuel Duty Freeze Extended

Good news: fuel duty will remain frozen until March 2026, along with the 5p-per-litre cut first introduced in 2022.

That’s a win for drivers—saving the average motorist around £59 a year, according to the Treasury.

The freeze isn’t guaranteed to last. Many expect the next full Budget to reconsider this policy, particularly as the government looks for ways to boost public finances.

EV Policy: More Questions Than Answers

The Spring Statement didn’t address the government's zero-emission vehicle (ZEV) mandate or its 2030 petrol and diesel ban pledge, but the pressure is building.

Manufacturers are calling for a review of the current rules, which require 28% of new car sales to be electric in 2025.

Many carmakers say the targets are too ambitious, especially without stronger incentives for private buyers.

In response, the government has promised a ZEV policy review, expected soon. Until then, EV drivers and dealers alike face uncertainty.

Support for Car Industry: Still Waiting

Despite recent closures and investment delays in UK car manufacturing, the Spring Statement didn’t include targeted support for the automotive sector.

Big players like Stellantis and BMW have already scaled back UK plans, citing policy uncertainty.

While government funding has gone into EV charging infrastructure, industry bodies like the SMMT are still calling for:

• Lower VAT on public charging
• More grants for EV buyers
• Stronger support for domestic manufacturing

Without these changes, there are concerns the UK could fall behind in the global car market.

What This Means for Drivers

While the Spring Statement didn’t introduce new motoring taxes, the reality for drivers is still challenging.

Costs are rising across the board. Whether you’re taxing your car, filling up, or buying a new EV.

At the same time, uncertainty around long-term policy goals means drivers are left guessing about the future—particularly when it comes to switching to electric.

Hopefully the months ahead could bring more clarity.