March/April 2016
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BVRLA News The bimonthly newsletter of the British Vehicle Rental and Leasing Association
Budget fails to address industry’s tax concerns The Chancellor of the Exchequer, George Osborne, has delivered his eighth Budget, announcing a number of measures that will impact the fleet industry. The BVRLA welcomed the continued freezes in fuel duty, Vehicle Excise Duty (VED) rates for HGVs, and the Road User Levy, as well as the plan to cut Corporation Tax to 17% by 2021. The three-year extension on 100% first year allowances for businesses purchasing ultra-low emission cars was also positively received, although the BVRLA expressed disappointment that this benefit continues to be denied to companies that lease their cars.
Before the Budget, the BVRLA wrote to HM Treasury highlighting the increasing tax burden on company car drivers. Demonstrating the combined effect of the two percentage point increase in Company Car Tax bandings from 2017, plus the abandonment of the Chancellor’s previous pledge to remove the additional 3% surcharge on diesel vehicles, the BVRLA outlined how this will result in an average tax increase per company car driver of £626.94 in 2017-18, and £882.26 in 2018-19. This growing tax burden could
exacerbate the reduction in the number of company car drivers, which has fallen by 30,000 since the Chancellor took office. BVRLA Chief Executive Gerry Keaney said: “While the decision to retain the 3% diesel supplement for the next three years was announced in the 2015 Autumn Statement, it’s unacceptable that the Chancellor has not seen the error of his ways and done a U-turn in this Budget. This punitive tax on company car drivers penalises innocent employees for decisions they have already made.” The BVRLA also expressed caution at the Chancellor’s repeated reference to reviewing the current salary sacrifice arrangements. Although HM Treasury has stated its intention to maintain the attractiveness of salary sacrifice schemes, only childcare, cycle purchase and pension schemes were specifically mentioned in the Budget statement. Further announcements are expected, with HM Treasury considering a formal review of salary sacrifice arrangements ahead of this year’s Autumn Statement. The BVRLA will meet with representatives of the Treasury to discuss the scope of this review, and will contact interested members to discuss an industry response. Keaney said: “It’s vital that the government understands the cumulative effect of its announcements, rather than looking at them in isolation. The rental and leasing industry is responsible for more than four million vehicles and contributes £24.9bn to the UK economy. It relies on a fair and simple system of taxation.” u The BVRLA’s summary of Budget 2016 is available at www.bvrla.co.uk
CV Show launch for Fair Wear & Tear Guide Fully revised and clearer than ever, the BVRLA’s Industry Standard HGV Fair Wear & Tear Guide is ready for action. page 4 Association talks to Highways England The BVRLA leads crisis talks to address problems dogging the Dart Charge payment system for crossing the River Thames. page 5 BVRLA policy papers set fleet agenda Four policy papers have been issued to address key areas of concern to the industry. page 6 Leasing survey sets out business growth The latest figures show that BVRLA members’ business leasing fleet continues to grow. page 7 Pow! Annual Dinner packs a punch! The industry’s biggest social event has already happened: relive the highlights here. page 8 Training gets off to a flying start in 2016 The BVRLA’s training division has already delivered several effective courses this year – including one in Poland. page 10
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