You may have heard Philip Hammond delivered his second Budget, as chancellor, yesterday. Here are some of the key points that will affect the motor industry;
Vehicle Excise Duty
Vehicle Excise Duty (VED) rates for cars, vans and motorcycles registered before April 2017, and the First-Year Rates for cars registered after April 2017, will increase in line with RPI from 1 April 2018.
There will be a new VED supplement on new diesel cars first registered from 1 April 2018, so that their First-Year Rate will be calculated as if they were in the VED band above. However, this will not apply on those diesel cars which meet Real Driving Emissions Step 2 (RDE2) standards.
The BVRLA’s updated factsheet on Vehicle Excise Duty is here: https://www.bvrla.co.uk/advice/factsheet/ved-taxation-regime
Company Car & Van Tax
Company Car Tax (CCT) on diesel cars which do not meet the Real Driving Emissions Step 2 (RDE2) standards will increase, rising from the current 3% supplement to 4%, with effect from 6 April 2018. This will apply only to cars, not commercial vehicles. The Fuel Benefit Charge and the Van Benefit Charge will both increase by the RPI rate from 6 April 2018. Company Car Tax rates have been published up until April 2021, rates beyond 2021 will be published in Budget 2018.
The BVRLA’s updated factsheet on Company Car Tax is here: https://www.bvrla.co.uk/advice/factsheet/company-car-taxation
Ultra-Low Emission Vehicles
The Government will also invest £200 million, to be matched by private investment, for a new £400 million Charging Investment Infrastructure Fund. The Government have also committed to ensuring at least 25% of Central Government department fleets will be electric vehicles by 2022.
The Plug-In Car Grant will also continue to 2020, with a further £100 million provided by HM Treasury. Employees charging electric vehicles at work will not be subject to benefit-in-kind taxation.
Connected and Autonomous Vehicles (CAVs)
The UK driverless car industry is estimated to be worth £28 billion to the UK economy, employing 27,000 people. The Government will make changes to the regulatory framework, such as settings out how driverless cars can be tested without a human safety operator, to ensure fully self-driving are on UK roads by 2021.
The National Infrastructure Commission (NIC) will also launch a new innovation prize to determine how future roadbuilding should adapt to support self-driving cars.
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