Rachel Reeves has been accused of piling fresh pressure on UK motorists with new figures revealing drivers now pay around £2,190 more a year on car tax and insurance than a decade ago.
The Chancellor is pressing ahead with Vehicle Excise Duty increases from April, raising the standard annual rate for light passenger vehicles from £195 to £200.
Meanwhile, the Expensive Car Supplement for vehicles costing more than £40,000 will also increase from £620 to £640.
Fresh analysis, using Office for National Statistics data, showed the overall burden on drivers has surged dramatically, with combined tax and insurance costs soaring by more than 210 per cent since 2016.
In practical terms, a motorist who spent £1,000 on vehicle tax and insurance in 2016 would now be facing bills of approximately £3,190 for the same cover.
First-year VED rates for the most polluting vehicles are set to reach £5,690 in April, while even electric vehicles, once exempt from car tax, will face a £10 charge under the new regime.
Imran Malek, corporate sales manager at TrackDays.co.uk, said: “The cost of motoring figures will be an eye-opener to many motorists.”
The findings come as the Government launches its Fuel Finder initiative, aimed at helping drivers locate cheaper petrol prices.
Under the new rates, drivers will pay £2,190 more than a decade ago
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X/DVLA/PAPetrol prices have climbed by just 37 per cent over the past 10 years, a comparatively modest increase when set against the steep rises in tax and insurance.
Mr Malek added: “While the long-term data shows petrol and oil prices are volatile, they have risen far less than other motoring costs, not least motoring tax and car insurance, over the last decade.”
Fuel prices spiked during the 2022 energy crisis before falling back, but the overall upward trajectory has been far less dramatic than the steady climb in vehicle taxation and premiums.
Across the board, overall motoring costs have risen by nearly 60 per cent in the past decade, with young drivers bearing the brunt of huge costs.
The Government hiked the Expensive Car Supplement rate in line with inflation | X/DVLA
One driver from Birmingham said: “My insurance has shot up despite having no claims. I was paying around £1,100 a couple of years ago, now it’s closer to £1,650 at renewal.
“That’s £550 extra a year for the same car and the same driving. It feels like you get punished just for being young, even if you’re careful.”
Insurers pointed to higher accident risks among younger motorists as justification for elevated premiums.
Industry-wide pressures have also helped drive costs up, including rising repair bills, difficulty sourcing spare parts and larger compensation payouts following accidents.
The Chancellor introduced new car tax measures at the Autumn Budget | GETTY
Drivers with EVs priced less than £50,000 will benefit from a raised threshold, exempting them from paying the “luxury” car tax.
Mr Malek stated drivers can attempt to cut costs by adding an experienced named driver to policies, paying annually rather than monthly, choosing cars in lower insurance groups and avoiding modifications.
The expert said: “Any way that drivers can reduce their own motoring outgoings, whether that’s through driving efficiently and planning journeys, for example, has to be welcomed.”
