Association calls for ‘fair and transparent’ car taxation
The Chancellor’s Pre-Budget Report (PBR) should be used by the
government as an opportunity to “clear up all remaining uncertainty
surrounding the major Corporation Tax Review planned for April
2009”, said the British Vehicle Rental and Leasing Association
(BVRLA).
The association has consulted with HM Treasury on the areas
in which fleets need clarification. They are:
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- Transitional Rules – businesses need to know how long cars
purchased or leased before April 2009 will be ‘grandfathered’ in
the current regime - The lessee chain – the fleet industry needs confirmation that
only the final customer in the lease chain is subjected to a lease
rental restriction (LRR). This would remove the current, unintended
consequence of the proposed tax review, where all the parties in a
lease chain are hit by the LRR
The BVRLA acknowledged that the current economic situation made
it unlikely that motoring taxes would be cut, but asked for the tax
regime to be made more “equitable”, by reducing the scale of the
planned increases in VED for existing higher emission cars
(emitting more than 180g/km CO2), and by removing the “unjustified”
3 per cent diesel supplement from company car and fuel
benefit-in-kind taxation.
“We can understand the Treasury’s argument for increasing
VED for new higher polluting cars, but we feel the scale of the
rise is unfair on people who have already purchased cars expecting
to see the traditional inflationary increases in excise duty,” said
John Lewis, BVRLA director-general.
“With today’s modern diesel engines there is no justification
for a 3 per cent supplement in BIK taxation. The government has
already got rid of the diesel supplement in VED, it needs to do the
same with company car tax,” Lewis added.
