Budget 2027 favours EVs, fuel excise pushed back to February

Budget 2027 was announced this afternoon by Government ministers, which includes tax measures to support the adoption of electric vehicles.

The VRT relief for EVs, which was due to end on 31st December 2026, is being extended for two years to the end of 2028.

From 1st January 2027, the Category A VRT percentage rates, used to calculate the CO2 component of the charge, are being increased.

The percentage rates applicable to bands 3 to 20 inclusive (cars with CO2 emissions of more than 80g/km and upwards) are being increased by one per cent.

The rates applicable to bands 1 and 2 will remain unchanged.

Meanwhile, the restoration of excise on petrol and diesel, due to begin on 1st November, has been postponed to 28th February, 2027.

This will be restored gradually in four phases, with a full restoration set for 30th June next year.