Question to the HM Treasury:

To ask the Chancellor of the Exchequer, when the HGV road tax holiday will commence and finish; what the eligibility criteria are for that scheme; and how the application process will work.

The government will introduce a 12-month holiday from Vehicle Excise Duty (VED, also known as road tax). This will apply to the majority of HGVs renewing their VED between 1 July 2026 and 30 June 2027. Eligible vehicles will pay just £1 for their annual VED, saving £600 for a typical heavy lorry. Tax classes eligible include: standard HGV (tax class 1); trailer HGV (tax class 2); special types (tax class 57); combined transport (tax class 23); and island goods vehicles (tax class 16). If a vehicle is liable for the HGV levy, it will continue to be charged at the existing rate.

This temporary reduction in VED is in recognition of the key role the road haulage sector plays in transporting goods, including food, across the UK and its disproportionate exposure to fuel costs. Fuel costs make up a substantial proportion of HGV operating costs, and this action will help prevent cost pressures from the Iran conflict spreading across the economy.