Fleet News

Call for cut in tax benefits to high mileage drivers

INFLUENTIAL environmental lobby Transport 2000 has called for a complete overhaul of the company car tax regime to penalise high mileage drivers and reduce annual business journeys by 5.4 billion miles a year. In its report 'Winners and Losers: Company Car Tax Reform', Transport 2000 demands the abolition of tax benefits for drivers who cover more than 18,000 business miles a year, which it says directly undermine the Government's aim of traffic reduction.

At the moment drivers enjoy a tax discount of one third if they drive more than 2,500 miles on business and two thirds if they drive more than 18,000 business miles, providing an incentive for fleet drivers to make unnecessary business journeys and to drive rather than use public transport.

Transport 2000 suggests drivers should enjoy a tax break for driving fewer than 14,000 private miles, and a further break if they drive fewer than 5,000 private miles a year. Private mileage includes commuting, but excludes journeys on company business. The report says the UK's 1.8 million company car drivers each drive an average 21,900 miles a year, more than twice the national average and a major contribution to pollution and congestion.

Report authors Malcolm Fergusson and Dr Ian Skinner, from the Institute for European Environmental Policy, say their proposals would: 'Cut traffic by 2.2 billion miles by removing the current incentives for business travel and encourage company car drivers to reduce their private mileage cutting traffic by a further 3.2 billion miles.'

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