Calls for company car tax re-think

  • April 2015 sees huge increase in low-CO2 car taxing
  • Trade body urges Government to re-think sharp hike
  • Vote in our poll: will it stop you choosing an 'eco' car?

There are calls for the Government to re-think its company car tax strategy moving forwards. The British Vehicle Rental and Licencing Association, or BVRLA, is urging a review of the measures announced in this year’s budget which appear to penalise drivers of low-CO2 cars.

As Parkers reported at the time of the Budget, after April 2015 drivers of cars which emit 75g/km of carbon dioxide or less will see a huge hike in their monthly tax bills. At present such cars are taxed at either zero or 5%, but when the new laws come in the taxable P11d value will shoot up to 13% overnight. This will have a dramatic effect on monthly running costs.

For example, a Vauxhall Ampera, with a P11d value of £31,195, currently costs £62 per month on the 40% pay scale. This will shoot up to £135, meaning you’ll be in for a huge £878 hike in tax over the whole year. This represents a very sharp rise in running costs, so BVRLA is campaigning for changes to be implemented much slower to make it easier on company car drivers’ pockets.

"Tax incentives for reducing fleet emissions have worked too well and the government is worried about falling revenues," said BVRLA chief executive John Lewis.

"But these measures are ill-advised, unfair and over aggressive. 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.

“We understand the need for austerity measures, but this assault on essential road users will result in more harm to the environment. It is even more misguided than the Pasty Tax.”

Will the company car tax changes in April 2015 stop you buying a low-emissions car?