FLEET managers have been urged to consider the threatened abolition of recommended retail prices as an incentive to prepare now for the 2002 introduction of benefit-in-kind company car tax based on carbon dioxide.

The warning was issued by Alan Miles, administration and data protection manager, with responsibility for staff vehicles at the Royal National Institute for the Blind, in reaction to increasing speculation that the pricing system faces abolition as a result of changes in the way the Inland Revenue calculates tax relief on lease vehicles.

Industry insiders say the Inland Revenue's decision to allow fleet discounts to be included in the definition of the retail price of a lease car when deciding the percentage of rentals which can be offset against tax could lead to changes to benefit-in-kind calculations.

Miles told a meeting of the Association of Car Fleet Operators' East Anglia branch: 'It could well be that if recommended retail prices are lost it would be another nail in the coffin for list prices. And if there are no list prices what do we put the CO2 data against to work out benefit-in-kind? The Inland Revenue has assured me that the list price is needed, but we must be on the alert.

'I would urge fleet managers to collect CO2 data now and be prepared for the abolition of list prices because those who went through the change to the basis of the P11D from engine size to list price will know the stress likely should they react at the last minute.'

Miles also urged fleet managers to 'badger' their software providers to update systems to incorporate BIK calculations based on CO2 capabilities.

He said the evidence suggested few fleets had acted to prepare themselves for the new tax law: 'My vehicle supplier Marshall Rover, in Peterborough, said I was only the second client to ask for CO2 emissions data on their vehicles,' said Miles.

And Julie Jenner, who manages Nokia UK's fleet of in excess of 700 vehicles, said she had initially faced 'apathy' from her drivers on the CO2 issue.

'This changed as soon as I pointed out that the legislation changes will impact on their car choices later this year. I'm now getting revised orders based on an enlightened view,' she said.