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Your Money > Travel Finances Articles > Cut your car...
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By Sarah Modlock
Car drivers are in for a bumpy ride in the coming weeks and months. Not only is fuel going up (and up) but new road tax rules will leave tens of thousands of families out of pocket and potentially with cars that are worth almost nothing. Taxing times The Treasury admitted to the Times newspaper last week that it plans to quietly abolish the exemption of higher road-tax rates for cars that emit more than 225g of CO2 per km and were registered between March 2001 and March 2006. This means that owners of larger cars bought since March 2001 will find that their road tax will rise steeply from next April. The increases are being introduced in two stages, with many owners who are now paying £210 a year being charged £300 in 2009 and up to £455 in 2010. Although the tax changes were announced in the recent Budget, their real impact is only just emerging, with even the Treasury acknowledging that the details were not spelt out as clearly as they could be. And while this may sound like a move towards a greener Britain but motoring groups say that it is unfair to penalise families who bought their cars several years ago, when people knew less about the consequences of CO 2 emissions. The information is not even mentioned on the DVLA's car tax pages on its website. If you own a Renault Espace, Vauxhall Zafira, VW Sharan, Ford Galaxy, Citroën C8, Vol-vo XC90 and others that emit more than 225g of carbon dioxide per kilometre, you will pay £430 in 2010 compared with £210 this year. Owners of medium-sized cars that emit more than 180g/km, including some Ford Mondeos, will find taxes rising by up to £100. The real crunch comes when you try to sell you car and find that it is worth much less than you expected because of increased cost of fuel and tax. Dealers are already reporting faster depreciation on these models. Road tax has varied since 2001, with Gordon Brown introducing a 'G rate' in 2006 for cars registered before March 23 that year. Then in last month's Budget, Alistair Darling announced a new system of 13 bands, from A to M, coming into force next April and a showroom tax of up to £950 starting in April 2010. The Chancellor said that the changes would raise an additional £1.2 billion up to March 2011 but failed to make clear that a significant portion of this would be paid by owners of older cars who would lose their exemption. Will you have to pay? To find out, check your car's CO2 emissions on your V5c vehicle registration certificate. It's on the second page in section 4 under "vehicle details". Then check the rate for that emission level on p122 of Chapter A of the supporting documents on the Budget 2008 website: www.hm-treasury.gov.uk/media/2/5/bud08_chaptera.pdf Feel the burn The bad news on car tax comes as all motorists struggle with the soaring cost of petrol. I remember writing about the 'psychological' ceiling of £1 a litre being broken last November and never dreamt it would climb so much higher - around £1.10 per litre on average in the UK, a 20-year high which means that many cars will cost more than £60 to fill. Consumer website petrolprices.com says this won't get better any time soon and expects drivers to be facing £1.50 a litre at the pumps by next year. All of this is especially maddening in the face of such enormous profits for the big oil companies. Shell made profits of $7.8bn (£3.9bn) in the first three months of the year and rival BP saw its profits rise 48% to $6.588bn (£3.31bn). Some of the cheapest prices I have seen are in supermarket petrol stations. It certainly pays to fill up before you hit the motorway. To offset the rising costs, here are more than a dozen ways to be more fuel efficient and save money from the motoring experts at recovery service Green Flag: Slow down. Keeping your speed down can reduce the fuel consumption of the engine. It goes without saying that we should all stick to the speed limit, but your car's handbook will tell you what the most fuel-efficient in-town and out-of-town speed is for your particular model. Lose weight. Avoid carrying any unnecessary weight in the car - including unused roof and bike racks - as heavy loads put more strain on the vehicle, leading to higher fuel consumption. The average vehicle carries around up to nine stone in 'bits and pieces' and rubbish. Find the shortest route. Taking the trouble to find the shortest route to your destination can make the journey more economical. Green Flag's online route planner can help you establish the shortest route from your doorstep to any destination in Europe. Cut the air con. Running the air conditioning increases the car's fuel consumption so if you want to economise keep it to a minimum. Close the windows. Open windows and sun-roofs create drag which means that you won't travel as far per litre of fuel. Share journeys. By sharing journeys with friends and colleagues the overall fuel consumption can be reduced.Multi-tasking saves money. One long multi-purpose trip is more fuel efficient than several short ones, as a cold engine uses more fuel than a warmed up one. Shop around. Check out the difference in prices charged by garages in your local area. Prices can vary, and if you are a high mileage driver who fills up regularly even one pence off a litre can make significant savings. Avoid filling up at motorway service stations as their prices tend to be higher. Check your pressure. Checking tyre pressure regularly not only improves the safety and performance of the tyres, it also keeps the car running at the optimum fuel efficiency. Smoothly does it. Try to drive as smoothly as possible and maintain a steady speed. Braking and then accelerating regularly will reduce the number of miles per litre the car can clock up. It's easier to drive smoothly (and also much safer) if you keep a gap of at least two seconds from the car in front of you. Give the car a break. When queuing in heavy traffic or waiting for passengers, turn off the engine to avoid wasting fuel. Stay tuned. Have your car's engine tuned at a reputable local garage to ensure it is running at the optimum fuel usage level. Check the oil. As well as maintaining the correct levels of oil, motorists who want to save money on fuel should check the type of oil used, as some energy-efficient types can increase the number of miles per litre. Useful links: |
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