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How to avoid ULEZ, congestion charging and CO2 tax

If you live near or work in a major city, you might be faced with ULEZ or congestion charge zone

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UPDATE: in November 2022, Chancellor of the Exchequer Jeremy Hunt announced that electric vehicles would have to pay road tax from 2025.

EVs are set to be charged the lowest band for new cars in the first year – currently £10 – and will then pay the same rate as other vehicles.

It won’t have escaped your notice that there’s been a concerted push towards making motoring much more environmentally friendly in recent years.

Climate change has prompted governments, businesses and people to think long and hard about what and how they drive, with the ultimate goal to make almost all vehicles on the world’s roads carbon neutral in the not-too-distant future.

One of the ways in which more carbon-friendly driving is being encouraged is with levies.

Charges are often introduced – especially in already very polluted urban areas – to discourage motorists from driving vehicles with particularly high emissions.

In the UK, there are three major financial penalties for cars deemed to not be environmentally friendly.

Let’s run through them here and explore the ways in which you can swerve having to factor them into your outgoings.

How to avoid paying the ULEZ charge

To stop London going back to its pea-souper days of yore, the capital has introduced a couple of schemes to try and prevent too many cars – especially high emissions ones – driving around its streets on a daily basis.

The newest is the ‘Ultra Low Emission Zone’ charge, or ‘ULEZ’ for short. It’s a levy of £12.50 payable daily, every single day of the year (except Christmas Day) for any motorist driving a car that doesn’t meet the strict emissions standards laid out.

To make sure you never need pay, the easiest way is to simply ensure that your car meets what’s called ‘Euro Emissions Standards’.

For petrol cars, they must be of Euro 4 standard or higher, for diesel cars it's Euro 6 or higher. Handily, all petrol cars on cinch are compliant with the ULEZ restrictions. Oh, and fully-electric cars are exempt.

You could also swap your car for a motorbike or moped – most new ones are Euro 3 compliant and aren’t forced to pay the ULEZ charge.

Alternatively, you could ditch your car and use a car club, or stop driving around central London entirely and embrace public transport, perhaps just driving out of town at weekends.

An updated version of the ULEZ map for 2024

Ways to sidestep the Congestion Charge

The main charge payable for motorists in London is its famous ‘Congestion Charge’.

Now payable every day of the week, if you want to avoid shelling out £15 a day, the easiest advice we can give you is simply to avoid driving in London.

The scheme is designed to deter drivers from clogging up the city centre with traffic, and as such, it doesn’t matter how carbon-friendly your vehicle is, you’ll be charged regardless.

If you can’t abide the thought of laying out £15 a day, you’ll need to think about catching buses, trains, the tube, or getting a taxi.

Cabs are exempt from paying the fee, by the way, as are emergency service vehicles, motorbikes, mopeds, and any vehicles used by disabled people.

Cyclists are, too, as you'd expect – as are fully-electric cars.

If you simply have to drive into London and are still keen to try not to pay, you’ll need to either get smart and try driving in, around and through the parts of the city not in the CC zone, or simply drive outside of the charge’s hours (as of March 2022, it's 7am-6pm Monday-Friday and 12pm-6pm Sat-Sun and bank holidays).

How to avoid having to pay the CO2 tax

Some people may talk about a ‘CO2 tax’ as if it’s a separate charge that you have to pay.

The reality is that when you hear mention of such a tax, it’s really just the good old-fashioned road tax that people are referring to.

Also known as ‘vehicle excise duty’ (or VED), the reason there’s a little confusion over it being a separate ‘new’ tax is because the amount for the first year is now dependent on the car’s CO2 emissions.

There are all sorts of different bands and rates for that first year. If you want to pay nothing, the only way to do so is to purchase an entirely zero-emission car.

Fully electric cars are exempt from the first year of road tax or ‘CO2 tax’, as are hydrogen cell cars. This doesn’t apply if the car costs more than £40,000, however.

If you’re not prepared to go fully electric, yet want to reduce your VED, you can opt for a hybrid or as close to zero-emissions vehicle as possible.

Being liable to pay any of these charges and refusing isn’t really an option – not unless you want to end up in court, or worse, prison.

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