THE controversial £25 vehicle first registration fee will be introduced on April 1, the Driver and Vehicle Licensing Agency has announced. Despite fleet industry and motor industry protests the introduction of the fee - designed to cover the administrative costs associated with registration of the vehicle throughout its life - has been confirmed.

The fee will be payable with the vehicle excise duty payment. However, the Government has agreed to waive the £25 levy on cars registered in the disabled tax class. The UK's largest fleet, Motability, welcomed the concession, which will apply to all the new vehicles it registers - in excess of 120,000 new cars annually.

The Retail Motor Industry Federation had raised the issue of disabled motorists paying the £25 fee in its campaign against the £25 charge, and will maintain its opposition to the levy. Christopher Macgowan, RMI chief executive, said: 'We have grave reservations about this. With over two million new vehicles bought every year, the Treasury stands to benefit to the tune of more than £50 million annually. This is a back door tax and the motorist is already paying £28 billion every year.'