Van Insurance News
BVRLA concerned over tax measures
24 July 2012
The British Vehicle Rental and Leasing Association (BVRLA) has expressed its concern over taxation measures planned for business fleets and laid out in this year's budget.
It has written to HM Treasury to express concern over the business car tax measures that it feels could have a negative effect on the sector by making it considerably harder for firms to claim tax relief on rental and lease vehicles.
Chief executive John Lewis suggested that the government is concerned that incentivising the reduction of fleet emissions has "worked too well", leading to falling tax revenues for the coalition.
"There is almost total consensus across the road transport and automotive industry that the government is in danger of erecting a massive roadblock across the road to low-carbon motoring," he warned.
Documents obtained by the BVRLA suggest that the Treasury is expecting to gain an extra £2 billion in company car tax between 2013 and 2017, making nearly one million fewer vehicles eligible for 100 per cent tax relief in this period.
"These measures are ill-advised, unfair and over-aggressive," stated Mr Lewis.
The group has set up a number of task forces aimed at underlining how the government's measures will affect the UK economy and damage company profits, as well as making trading conditions more difficult for fleet management and rental firms across Britain.
It will also seek to challenge the application of the Lease Rental Restriction, which stops companies deducting the full cost of leasing or renting certain cars from their taxable profits.
Mr Lewis accepted that the government needs to implement austerity measures in the current economic climate, but warned that this move could backfire, comparing it to the ill-fated tax on pasties that led to a humiliating climb-down from the government.
A recent report from the Society of Motor Manufacturers and Traders (SMMT) indicated that consumers and firms are placing more emphasis on green driving.
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