Fleet News

Still time to have a say on changes to car tax

THE Inland Revenue has called for fleet reaction to five key areas of the new company car tax system due to be introduced on April 6, 2002. Sara Woollard, policy adviser to the Inland Revenue's Personal Tax Division, has confirmed that major issues concerning the new environmentally-driven regime are still open for debate.

Speaking to a packed seminar at the 1999 Fleet Show at the NEC, Birmingham, on Tuesday, she reiterated that the skeleton of the system will feature a tax charge based on a percentage of a company car's list price, graduated according to its carbon dioxide emissions. This is likely to start at 15% of list price for the UK's cleanest cars, and rise by 1% of list price for every 5 grammes of CO2/km, up to a maximum of 35%.

Woollard said: 'The big question is how we vary the charge between those two points, whatever they end up at, in a way that not only encourages people to use greener cars, but is also revenue neutral.' She outlined five key areas of the new tax which are as yet unresolved: what to do about the oldest cars for which CO2 emissions data is not be available; whether the range of the 15% minimum to 35% maximum charge of list price was right; what types of emissions should the new system reflect - CO2 only, or others as well; whether a sliding scale between 15% to 35% was preferable to bands; whether the fuel emissions link should be phased in to encourage annual progress towards lower emission cars.

'We have received a steady stream of comments, but we want as many as possible so we can go back to ministers with a real feel for people's reactions and concerns,' said Woollard. The Inland Revenue has conceded that the proposed company car tax system will favour diesel-powered cars over petrol models, but suggested that diesel may incur a supplement because of the local particulate and nitrous oxide pollutants which it produces. Fleets have until May 31 to make their views known to the Inland Revenue, although more time is available if fleets are canvassing a wider audience.

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