U turn on 3% diesel BIK removal

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The government is retaining the 3% diesel company car benefit-in-kind tax supplement until April 2021, thus reversing a decision announced in the 2012 Budget.

It had been expected that from April 2016 the 3% supplement differential would be removed thus placing diesel cars on a tax parity with their petrol-engined rivals.

However, amid the ongoing debate over the relevance of the current vehicle emissions testing regime and the moves to introduce a system linked to real world driving, Chancellor of the Exchequer George Osborne reversed the 2012 decision in this week’s Autumn Statement.

He told the House of Commons that the supplement would be retained until new European Union-wide emissions testing procedures would ensure new diesel cars met air quality standards even under strict real world driving conditions.

Retention of the 3% supplement is forecast to raise an additional £1.36 billion for HM Treasury in the five years to 2020/21.

John Pryor, ACFO chairman, said: “ACFO is disappointed that the government has decided to retain the diesel supplement. There will be, ACFO is certain, many fleets and company car drivers that have made vehicle choices based on the fact that they would save cash as a result of the previously announced withdrawal of the supplement.

“Over many years, ACFO has been consistent in its call for clarity and long-term decision-making so that fleets and company car drivers could plan for the future in full knowledge of what the tax burden will be. This government U-turn does not assist that process.”

Fuel prices set to fall

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The price of a litre of fuel could reduce to the £1 mark - or even slip below the psychologically important barrier - in the coming weeks delivering further savings to fleets.
The price of a barrel of oil has fallen to $40.40 - its lowest price since February 2009 - paving the way for another round of pump cuts and making the sight of £1 a litre at the cheapest forecourts ever more likely, according to RAC. It expect pump price reductions of around 2p a litre in the next fortnight. 

Keeping personal data safe

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Fleets are being urged to ensure personal data is removed from electronic devices in vehicles in the wake of a survey of members by the Vehicle Remarketing Association (VRA).
The volume of vehicles entering the remarketing process and still containing personal data - notably on multi-media systems and satellite navigation devices - has highlighted a widespread concern that security is still an issue for the sector.
The survey reported that 90% of respondents felt there wasn’t enough clarity and understanding around personal data security protocols and the associated procedures for its removal prior to the vehicle resale.