Fleet News

Government VED reforms 'unacceptable and flawed'

TWO damning replies to the Government's proposals for reform of Vehicle Excise Duty have landed on the Treasury's doorstep as it brings to a close consultation on its controversial ideas. The RAC and the Engineering Council have lambasted Government proposals launched last year as 'unacceptable and flawed'.

They have been backed by fleet management and funding expert VELO, which has called for the Government to concentrate on fuel duty. But their attack may fall on deaf ears as, despite widespread industry discontent at many of the proposals in the consultation document, it is possible that Chancellor Gordon Brown's Budget could give graduated VED the go-ahead.

The Government has proposed that 'clean' cars would benefit from a £50 reduction in VED, with carbon dioxide emissions used to judge how much cars pollute. However, the new VED system would only apply to new cars, with the existing car parc judged on engine size, regardless of environmental performance. Diesel would also be a special case, attracting a 10% extra charge because of higher emissions of oxides of nitrogen and particulates.

The reaction from the RAC and the Engineering Council echoes the opinions of much of the fleet industry after the document was launched, with fleet managers condemning its 'woolly and half-cocked approach'. The Government's ideas seemed innovative, the RAC said, but they were 'based upon a flawed perception of the potential effectiveness of fiscal measures in changing individual lifestyles'.

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