UK Driving Law and Car Tax Changes in 2026/27: What Drivers Need to Know

Road tax and motoring cost changes in 2026

For some drivers, the biggest concern isn't new regulations; it's whether motoring is getting more expensive.

Several changes that can affect costs are already scheduled, including road tax updates from 1 April 2026, plus fuel duty increases from September 2026.

Car tax and allowance changes (April 2026)

The current VED rates, introduced from 1 April 2025 apply until 31 March 2026. From 1 April 2026, 2026/27 rates apply.

Under the UK's car tax system, most drivers pay:

• A first-year rate based on CO₂ emissions (for newly registered cars), then:
• A standard annual rate thereafter.

VED is usually uprated each tax year, so rates are expected to change from 1 April 2026 for 2026/27. However, the exact amounts should be confirmed against the official VED rate tables once the updated figures are published.

The Expensive Car Supplement (ECS) (often called the 'luxury car tax') continues to apply in years 2-6 for cars above the relevant list price threshold.

From 1 April 2026, the ECS threshold for zero-emission cars increases to £50,000 (up from £40,000), and it applies to zero-emission vehicles registered from 1 April 2025 onwards.

See our full car tax guide for a detailed breakdown of the latest car tax bands and rates.

Electric cars and road tax in 2026

Electric cars are no longer exempt from VED from 1 April 2025, and that will continue into 2026/27.

Before 1 April 2026 (current structure introduced from 1 April 2025):

• EVs registered between 1 April 2017 and 31 March 2025 pay the standard rate (£195).
• EVs registered from 1 April 2025 pay the lowest first-year rate (£10), then the standard rate (£195) thereafter.
• Older EVs registered between 1 March 2001 and 31 March 2017 pay £20.

From 1 April 2026, updated VED rates for 2026/27 will take effect (including for EVs), so it's worth checking the latest published rates when you renew or buy a vehicle.

The standard car tax rate for all powertrains is expected to increase slightly to £200.

For a full explanation of bands, thresholds, and how these changes could affect your running costs or resale value, see our detailed car tax guide.

Fuel duty

In her 2026 Spring Statement on 3 March 2026, Chancellor Rachel Reeves reaffirmed the fuel duty plan that was originally set out in the 2025 Autumn Budget:

• The temporary 5p per litre fuel duty cut will continue until 31 August 2026.
• From September 2026, fuel duty is scheduled to rise gradually, just as originally announced in November 2025. The following increases are currently planned:
  • +1p per litre from 1 September 2026.
  • +2p per litre from 1 December 2026.
  • +2p per litre from 1 March 2027.

This phased approach unwinds the temporary cut over several months rather than increasing duty all at once.

The planned increase to fuel duty rates, in line with inflation for 2026 to 2027, will not take place.

What this means for drivers:

• During the Spring Statement on 3 March 2026, the Chancellor confirmed that the duty increases will proceed as planned and that the temporary cut is simply being extended through August. The rises were not cancelled or deferred.
• Until 31 August 2026, the headline duty rate stays lower due to the ongoing 5p cut, so fuel price movements at the pump will largely reflect global oil markets rather than changes in Government tax policy.
• From September 2026 onwards, motorists should expect stage-by-stage increases in duty, adding gradually to the price of petrol and diesel.
• With price increases at the pump around the corner, drivers are advised to shop around and utilise fuel price comparison apps, with the Government's Fuel Finder service, and loyalty schemes to maximise savings.

Company car tax changes (April 2026)

With each tax year, company car drivers continue to see gradual Benefit-in-Kind (BiK) tax increases.

While EVs remain cheaper than petrol or diesel company cars, their tax advantage is slowly being reduced. However, despite these increases, EVs will continue to attract the lowest BiK rates over the coming years.

New BiK rates for the 2026/27 tax year will be introduced on April 1st 2026.

You can find all the BiK rates from 2025/26 through to 2029/30 in our car tax band guide.

Motability scheme changes (July 2026)

In November 2025, premium car brands including Audi, BMW, Lexus, and Alfa Romeo were removed from the Motability scheme.

From July 1st 2026, VAT and insurance costs will also increase for Advance Payment vehicles. However, exemption for Wheelchair Accessible Vehicles (WAVs) will continue.

Electric car tax and Expensive Car Supplement changes (April 2026)

From 1st April 2026, the Expensive Car Supplement (ECS) rules will change for fully electric cars:

• New EVs with a list price between £40,001 and £50,000 will no longer be liable for the ECS.
• The ECS will still apply to all petrol, diesel, and hybrid cars with list prices exceeding £40,000 – and EVs with a list price over £50,000.

The ECS is an additional annual charge which is paid on top of standard car tax. It applies from the second to the sixth year after a car is first registered.

As of January 2026, the ECS is set at £425, and is due to rise to £440 from April 1st 2026 for the 2026/27 tax year.

Congestion Charge increases and new charges for EVs (launched Jan 2026)

The Congestion Charge scheme levies a daily charge on vehicles travelling within the City of London and London’s 32 boroughs during its hours of operation.

On January 2nd 2026, the following changes were implemented:

• The standard Congestion Charge increased from £15 to £18 if paid on the day (or £21 if paid later).
• The full exemption for EVs was revoked.
• However, EVs that are registered for Auto Pay will receive a 25% discount meaning they’ll pay £13.50 per day.
• Electric vans, HGVs, and quadricycles are eligible for a 50% discount (working out at £9 per day).

Please note: If you fail to pay the Congestion Charge by midnight on the third day after travel, you will be liable for a £180 Penalty Charge Notice (PCN), discounted to £90 if paid within 14 days.

For more information, please visit the Transport for London (TfL) website.

Self-driving cars and the future of autonomous driving

The UK Government has confirmed that a passenger piloting system for self-driving vehicles will begin in spring 2026, with early trials of autonomous passenger services such as taxis, private hire vehicles, and buses operating under a permitting regime.

Driving licence and testing changes

Confirmed: Practical driving test booking rules (from spring 2026)

The most significant confirmed change for learner drivers in 2026 affects how car driving tests are booked and changed.

• According to the GOV.UK website, new Driver and Vehicle Standards Agency (DVSA) booking rules will come into force from spring 2026:
• Learners must book their own driving test. (Instructors will no longer be able to book on their behalf.)
• Learners will be allowed no more than two changes to their test booking.
• Test changes will be limited to nearby test centres, preventing long distance switches.

In this context, a ‘change’ constitutes:

• Altering the date or time of a test.
• Changing the test centre.
• Swapping with another learner who already has a test booked.

What does this mean for learners?

Under the new rules, booking a driving test will require more planning. If you’re not fully confident about your availability, it may be better to wait before booking rather than using up your allotted changes.

New CPR and defibrillator theory test questions (expected early 2026)

From early 2026, driving theory tests will include expanded first aid questions, covering:

• Cardiopulmonary resuscitation (CPR).
• Automated external defibrillators (AEDs).

The aim is to improve drivers’ understanding of how to respond in a medical emergency.

What learners should do:

If you’re taking your theory test in 2026, make sure your revision materials include basic CPR steps and what a defibrillator is used for. Visit the GOV.UK website for more information on this topic.

Digital driving licences

Status: Planned, not yet available

The Government has confirmed plans for an optional digital driving licence, delivered through a new GOV.UK digital wallet. Physical photocard licences will remain valid - and drivers will not be required to switch in 2026.

What this means for drivers:

Digital driving licences have not yet launched in the UK, and while the Government has confirmed plans to introduce them via the future GOV.UK Wallet app, drivers still need to use their physical photocard licence for now.

Potential law changes from the Government’s road safety strategy

It’s important to note that the changes outlined in this section are under consultation and have not yet been confirmed.

They form part of the Government’s Road Safety Strategy, which was announced in August 2025 and formally launched in January 2026. The strategy sets out areas the Government wants to review and improve.

This means the Government is gathering views, details may change, and some proposals may never become law. Others, if approved, are likely to be introduced later.

Minimum learning period for drivers

Status: Under consultation

The Government is consulting on whether learner drivers should complete a minimum learning period, which could be up to six months, before taking their practical test. The aim would be to ensure learners gain experience in a wider range of driving conditions.

Visit the GOV.UK website to learn more about this consultation.

Stricter drink drive limits and alcohol interlock devices for offenders

Status: Under consultation

One of the most significant proposals under consideration is a reduction in the drink-drive limit in England and Wales, which has remained unchanged since 1967.

The current limit of 80mg per 100ml of blood (the highest in Europe) could be lowered to match Scotland’s stricter 50mg threshold. However, as of January 2026, no new limit has been confirmed, and no official implementation date has been set.

The Department for Transport is also consulting on preventative measures for repeat drink driving offenders, including the use of alcohol interlock devices, which prevent a vehicle from starting if alcohol is detected on the driver’s breath.

This is part of the Government’s consultation on proposed changes to motoring offences.

Changes for learner motorcyclists

Status: Under consultation

Motorcycle safety is included within the strategy, with the Government consulting on potential improvements to training, testing, and licensing for learner motorcyclists. However, no specific rule changes have been confirmed as of January 2026.

Visit the GOV.UK website to learn more about this consultation.

Changes for learners, seniors, and driving licence updates

Status: Under consultation

Changes currently under consultation for driving licencing include:

• Mandatory eyesight testing for drivers aged 70 and over.
• Possible cognitive assessments for older drivers.
• Changes to penalties for motoring offences such as uninsured driving and illegal number plates.

Other key changes for 2026

Electric car charging price cap (launched in January)

Starting on January 1st 2026, a new electricity price cap of £1,758 came into effect. This marks a 0.2% price increase, meaning EV owners with home charging access will see a small increase in running costs.

This price cap will remain until the end of March 2026.

Fuel Finder Scheme (Confirmed for February)

The Government’s Fuel Finder Scheme, which is set to launch on February 2nd, will compel petrol forecourts to share pricing data with consumers.

The new initiative, which was announced during the Autumn Budget aims to improve fuel price transparency - and help consumers save more at the pump.

Fuel stations will have to share up-to-date petrol and diesel prices, so drivers can quickly compare costs and choose the cheapest options using apps and sat-navs.

New ZEV mandate targets for 2026

The Government’s Zero Emission Vehicle (ZEV) mandate requires manufacturers to sell more electric cars and vans each year. This initiative aims to expedite the adoption of electric vehicles ahead of the scheduled 2030 ban on the sale of new petrol and diesel cars.

Each manufacturer must ensure a minimum percentage of their new car sales are zero-emission (fully electric). The target percentage rises every year. If a manufacturer falls short, they can face financial penalties, unless they offset the shortfall in other approved ways.

In 2026, the target for cars and vans rose to 33% and 16% respectively. You can see the ZEV targets from 2025-30 below: