Fleet News

Graduated VED scheme 'falling apart at seams'

CONTROVERSIAL plans to introduce graduated Vehicle Excise Duty based on carbon dioxide emissions are in crisis and could collapse without an immediate change of attitude from Government ministers. The Treasury has been warned that, unless firm details on the shape the new system should take are provided almost immediately, the anticipated deadline for introduction of the tax in autumn next year will almost certainly be missed, raising fears the whole scheme could be scrapped altogether.

The warning comes on the eve of the first tentative steps towards graduated VED, with vehicles under 1.1-litres offered a £55 cut in road tax to £100 from Tuesday. The next step will be to base VED charges on CO2 from next year, and this week, the Treasury insisted the department was on target for creating the new tax and dismissed allegations that the Government might consider a U-turn.

News that the plans for graduated VED are in trouble will not surprise many fleet managers who have been vocal in their opposition to the scheme ever since the idea was introduced last year to encourage the use of smaller, more fuel-efficient cars. They branded the Chancellor of the Exchequer's ideas as 'muddled and contradictory' and highlighted gaping holes in policy which have still to be filled, including the treatment of alternatively fuelled vehicles and the lack of any useful policy on vans.

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