Fleet News

RAC tells Chancellor: Don't put 750,000 industry jobs on the line

THE RAC has warned Chancellor Gordon Brown not to jeopardise the 750,000 jobs which depend on the motor industry by imposing punitive new taxes on company cars. The motoring organisation claims the current tax system fairly reflects the benefit which a driver receives from his company car, but cautions that the margin between fair and penal taxes is very small.

It believes that if the tax burden increases many drivers will decide to leave company car schemes and will buy cheaper, older cars themselves, leading to a potential collapse in new car sales. John Hutson, RAC fleet spokesman, said: 'Company cars make up only 8% of cars on the road, and are among the newest and most environmentally advanced in the vehicle parc, yet they are often accused of causing most congestion and pollution problems.

'Yet company cars are a vital means for many businesses to deliver services and create wealth for the UK economy. They are the lifeblood of motor industry sales and the second-hand car market.' He added that any change to company car tax policy should discourage unnecessary car usage, not ownership; encourage and incentivise the use of environmentally-friendly vehicles; recognise the genuine importance to work of most company cars; and plough as much revenue as possible back into the transport network to ease congestion and improve the environment.

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