Fleet News

Act now over free fuel, ARVAL PHH urges fleets

COMPANIES providing drivers with free fuel for private mileage must act immediately to decide whether to offer the benefit next year, or risk administrative chaos as the tax year comes to an end.

Fleet decision-makers must be able to make clear the tax implications for the employer, how cash-for-car schemes are affected and the future of fuel cards under any new regime, says the company.

For the past four years, the Government has increased taxation on the perk of free fuel for private mileage by 20 per cent above inflation each year in a bid to remove the benefit.

ARVAL PHH is warning fleets that although they may consider abandoning the benefit, a key concern must be controlling and managing fuel expenses.

Julie Stribling, head of fuel sales at ARVAL PHH, said: 'In April 2002, company car taxation will change, but we will also see the last budgeted 20 per cent increase in the Fuel Scale Charge that sets the level of free fuel BIK tax.

'If fleets do not act immediately, they should be prepared for hundreds of angry drivers demanding to know why their tax bills have shot up for receiving free fuel for private mileage.

'No matter what decision companies make, they must retain control of their fuel costs, which is where fuel card providers such as ARVAL PHH/AllStar can help. Drivers need fuel cards now more than ever.'

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