September/October 2016
www.bvrla.co.uk
BVRLA News The bimonthly newsletter of the British Vehicle Rental and Leasing Association
Industry rallies against company car ‘tax raid’ The BVRLA and a coalition of other fleet industry stakeholders are working together to oppose yet another government tax raid on the company car market. HM Revenue & Customs wants to change the way employee benefits are taxed and has put forward plans that could affect up to 650,000 people who have taken a salary sacrifice car or receive a vehicle as part of a ‘cash or car’ benefit scheme.
Employee Benefits Consultation: What’s at stake? 650,000 people receive a salary sacrifice or cash alternative company car. 3 in 4 salary sacrifice car scheme members are basic rate taxpayers. 217,000 new cars are registered annually as a result of the employerprovided car market. 37% – the proportion of these cars built in the UK or containing a UK-built engine. 37,000 jobs are supported by the employer-provided car market.
The BVRLA and its members have joined forces with Fleet News, ACFO, car manufacturers and a wide cross section of public and private sector employers to share their concerns with a range of ministers, MPs and policymakers. The BVRLA believes the current company car benefit-in-kind tax (BiK) system provides a fair, equitable and
administratively simple way of estimating the cash equivalent of a company car for tax purposes. It says the new proposals would introduce confusion and inequity into the system by requiring employers to change or increase their reporting requirements and by taxing an employee who has a cash alternative to their company car differently from one who has exactly the same vehicle but no cash alternative. The BVRLA says the present tax system works for businesses, is fair for drivers and has proven very successful in helping the government meet its policy goal of increasing the uptake of low emission vehicles. Salary sacrifice and ‘perk’ company cars are the dominant source of ultra-low emission vehicle (ULEV) registrations in the UK, partly because drivers use the incentives within the current company car tax regime to reduce their BiK tax bill. The BVRLA warns that these incentives would disappear under the new proposals, which would see the average person opting for a ULEV being left hundreds of pounds a year worse off. ULEV registrations are likely to plummet, it says, as drivers choose a cheaper, higher-emission company car, use their cash allowance to fund a second-hand car, or opt-out of their employer’s salary sacrifice scheme. “Our analysis suggests that the governments’ proposals could actually reduce overall tax revenues, stifle the uptake of ultra-low emission cars and have a negative impact on cash-strapped public sector employers,” said BVRLA Chief Executive Gerry Keaney. u
Autumn Statement action stations The BVRLA has been busy briefing policymakers on a number of consultations that could affect members’ businesses. page 4 Minister extols car rental’s ‘extra choice’ Transport Minister Andrew Jones has praised car hire for giving people “extra choice for getting around”. page 5 Ford event will explain vehicles to members The BVRLA is partnering with Ford to give members the lowdown on its vehicle range. page 6 Golf Day goes down to the wire More than 70 people took part in a hardfought BVRLA Annual Golf Day this September. page 7 Survey details vehicles’ life cycles A survey of BVRLA rental members has revealed the structure of the market and its contribution to reducing vehicle emissions. page 9 New faces, new roles Following a round of changes at BVRLA HQ, the association would like to update members about a number of new recruits. page 10
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