Leading figures from the fleet sector have
given a mixed response to the UK coalition government’s 2012 budget
on Wednesday, although displeasure at the coming rise in fuel duty
was unambiguous.

While several expect to benefit from a variety
of corporate and personal tax reliefs, they have also bemoaned a
lack of credit or action on the cost of fuel.

Many fleet organisations were unimpressed with
the lack of a drop in fuel duty.

David Brennan, managing director at LeasePlan
UK said rising fuel costs placed “a severe financial strain on
businesses” and the maintenance of the duty rise in August was both
“a further burden” and a “short-sighted move”.

British Vehicle Rental and Leasing Association
chief executive John Lewis also added that the Chancellor had
“missed an open goal” by not cutting fuel duty which appeared to be
taxed as a “pernicious luxury”, a view shared by the Road Haulage
Association, Acfo, car supermarket Motorpoint and ATS Euromaster, a
fleet operator of 1,233 vehicles, which referred to the decision as
a “bitter blow right into the heart of the economy.”

Stone dead

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By GlobalData

Lewis praised the
National Loan Guarantee Scheme announced on Tuesday
for helping
provide “cheaper funding to lease arrangements” and showed
government recognition for the “role asset finance plays in
enabling companies to run”.

Lewis also applauded the cancelling of the 3%
diesel supplement and the five-year signpost for future company car
taxation.
 
Lewis, however, criticised the cancelling of the company car tax
exemption for electric vehicles, saying the measure “could kill the
electric car market stone dead” and the continued implementation of
the Lease Rental Restriction, “a double emissions tax on our
industry”.
 
On the other hand, Julie Jenner of Acfo, the association of car
fleet operators, said capital allowances and future company car
taxation “will drive fleet managers and drivers into lower emission
cars at a faster rate” and the “lowest CO2 emitting vehicles will
find their way on to fleet choice lists in a bid to keep tax bills
in check.”
 
Little or nothing
 
Brennan was in favour of the tax cuts which, along with
credit-easing, “will be a significant help to many
businesses”.
 
Brennan also pointed out businesses such as fleet “should be able
to drive on roads that are fit for purpose” and welcomed the
promised investment in UK roads, though derided the government’s
plan to increase the number of toll roads as a means to tackle
congestion.
 
Gary Gibson, head of customer services at fleet IT provider epyx
said the Budget would make little change to fleet companies’
“renewed focus on cost control and reduction… to retain their
competitive edge,” offering a “sensible” stability.
 
“While there are the usual annual increases in benefit in kind
taxation to examine in detail, including the intriguing removal of
the diesel surcharge from 2016, and the first capital allowance
reduction to 130g/km from next year shows an ongoing commitment to
carbon reduction,” said Gibson, “there is little or nothing here
that is not clearly signposted and cannot be built into future
fleet planning.”
 
Similarly, for Brennan and LeasePlan, the company was “optimistic
that 2012 will, on balance, bring greater confidence to the SME
sector.”

richard.brown@vrlfinancialnews.com