A new study has revealed that women and baby boomers will be the worst impacted by the rise in first-year rates for Vehicle Excise Duty (VED) this year.

If buying habits remain the same as in 2024, men who buy a new car between April and September will pay an additional £55.3 million towards the tax compared to last year, according to the research. In comparison, it estimates that women will pay an extra £62.8 million towards the tax – £7.4 million more than men.

The research comes from Go.Compare car insurance, which reviewed Department for Transport figures on the number of new private vehicles registered in the first half of the 2024 tax year. It applied the old and new first-year rates for VED to these vehicles to estimate how much more new car buyers will pay if buying habits stay the same, and who will be most affected.

The insurance comparison site attributes the difference to men being more likely to buy cars with cleaner fuels. It says that one in 10 men have a battery electric or plug-in hybrid electric car, compared to only 7% of women. Meanwhile, just over two-thirds (68%) of women own a petrol car, compared to 58% of men. As the tax bands are based on CO2 output, this means women are more likely to be hit with higher fees.

Baby boomers will be the most impacted of any generation for the same reason. In total, it’s estimated that baby boomers will be taxed an extra £40.5 million as a result of the changes. Just 6% of baby boomers drive either a battery electric or hybrid electric car, Go.Compare’s survey found, compared to 11% of millennials and 9% of Gen X.

As a result, it’s estimated that millennials who buy a new car between April and September will be taxed an extra £34.9 million after the changes – £5.5 million less than baby boomers. Similarly, Gen X will pay an additional £28.8 million more – £11.6 million less than baby boomers.

Extra cost of first-year VED rates for new car buyers in April to September 2025 by generation

• Gen Z (1997 and later) – £11,348,485

• Millennial (1981-1996) – £34,985,214

• Gen X (1965-1980) – £28,856,779

• Baby boomer (1946-1964) – £40,505,806

• Silent generation (1928-1945) – £2,924,456

Tom Banks, car insurance expert at Go.Compare, said: “Unfortunately, some groups will be worse impacted by the rising VED rates than others, which is mainly down to the type of cars they tend to buy.

“Our figures suggest that a higher proportion of men drive low-emission vehicles, meaning more men fall into the lower tax bands. Similarly, a higher proportion of women drive petrol cars, placing more of them in the higher bands.”

“But crucially, the increased rates mean all new car buyers will pay more this year. To cut these costs, go for a low-emissions car at the showroom if you can, as that will place you in the cheaper tax bands. Or, consider getting a ‘nearly new’ vehicle instead. This will give you that new car feeling for a fraction of the price, and allow you to dodge the increased tax.

“Otherwise, see if there are any other ways you can reduce your motoring spending to make up for the tax increase. For example, comparing car insurance policies might allow you to find a provider that offers the same level of cover for a lower price, and driving more economically could help to reduce your fuel costs.”

To find out more about the rise in first-year rates for VED, go to Go.Compare’s website.