Initial reaction from the industry to Labour's 179-seat majority was mixed, with BVRLA general secretary Norman Donkin expressing concern that the new Government could introduce changes in the VAT treatment of new cars and introduce a luxury rate of tax on gas guzzlers. However, ACFO director Stewart Whyte said if the Labour Party stuck to its pre-election policies he saw no risks facing either fleet managers or company car drivers.
With Prescott heading up a new Whitehall super ministry it is clear the new Government is to try to combine transport and environmental strategies. This could result in far-reaching policies involving further increases in fuel prices, encouragement for low emission, smaller engined vehicles, and simultaneously the introduction of a harsher tax regime on gas-guzzlers, changes in the 2,500 and 18,000 business mileage tax breaks, and further encouragement for vehicles powered by alternative fuels.
New Chancellor of the Exchequer Gordon Brown is expected to hold a mini-budget within the next two months when details of the Government's transport and environmental policies are likely to be revealed.