Cuts to company car benefit-in-kind tax for ultra-low emission vehicles should be brought forward, according to the British Vehicle Rental and Leasing Association (BVRLA).
 
The BVRLA argues that announcing that from April 2020 employees selecting ultra-low emission cars can make significant tax savings could mean take-up of those vehicles is delayed for three years.
 
In last month’s Autumn Statement, the Chancellor unveiled a number of measures aimed at boosting the emerging market for cars emitting less than 75g/km CO2. They included a new, more granulated range of company car tax bandings for ULEVs from April 2020, which was confirmed with this month’s publication of the 2017 Finance Bill. From April 2020, the appropriate tax rate for zero emission cars will drop from 16% to 2% and there are significant cuts for other ultra-low emission vehicles.
 
“It is great to see that the government now has a more comprehensive strategy on ultra-low emission vehicles, which recognises the huge role played by the fleet sector,” said BVRLA chief executive Gerry Keaney.
 
However, he added: “The company car tax regime is the single most powerful tool policymakers can use to drive behaviour change, but it is not being used effectively.
 
“By signposting these tax incentives but delaying them until 2020, the government could encourage thousands of pragmatic, cost-conscious drivers to defer the move to low emission motoring.”