- There was some good news for the greener future of our roads last week in Philip Hammond’s autumn budget. The Chancellor announced measures aimed at increasing take up of electric vehicles and reducing the economic appeal of diesel cars, both for personal and company use.
Barrie Kenyon of Green and Co Accountants comments, "Over the last few years we have seen the Government target company cars, making it far less beneficial to buy a high emissions vehicle through your business.
"It would have been nice to have seen more incentive for businesses to buy more environmentally friendly vehicles. There was a rumour we might have seen extremely low benefit in kind charges for hybrid vehicles, which did not materialise. Hopefully we will see more from the Government on this in the future."
So what's changed?
- The government has earmarked £200m for a national charging network for electric vehicles.
- A further £100m will be used to continue an electric car buying subsidy to 2020. The subsidy contributes up to £4,500 towards the cost of buying an electric car.
- The law around benefit-in-kind tax will be clarified, meaning that workers who charge their electric cars at work won't be charged more.
- The tax rate for new diesel cars will go up by one band From April 2018, and the company car tax levied on diesel cars will increase by 1% to 4%*.
- £40m is to be used for the development of driverless cars, supporting the Government’s plans to allow driverless cars onto UK roads from 2021.
* This won’t apply to diesel cars that meet the most recent emissions standard, but as the tests won't become a legal requirement until 2020 all new diesel cars will face tax increases in the meantime.