Fleet News

Economy plan opens way to van tax move

THE Government is working with the European Commission to list the fuel efficiency of every light goods vehicle on sale by 2005 as part of changes to the way vans are taxed.

A new test cycle will enable the fuel efficiency of every van to be evaluated and will come into effect on January 1, 2005.

The Inland Revenue is examining the results of a consultation on van taxation which ended in August. It included proposals to link taxation to the level of private use of vans and to make drivers pay more on older, less environmentally-friendly vehicles, effectively scrapping the current £500 tax band (Fleet NewsNet August 7).

If the Government succeeds in introducing a fuel efficiency guide for every van available in the UK, it will make the introduction of environmentally-based taxes much easier.

However, any move would be controversial, as van drivers claim they cannot choose the vans they drive to do their jobs.

Details of the new tax strategy were listed in the first annual report on the Government's Powering Future Vehicles Strategy.

As part of the commitment to reducing emissions, the Government has created a board of 20 people providing strategic direction for a Low Carbon Vehicle Partnership, including Graham Smith, managing director of Toyota (GB), Jim O'Donnell, managing director of BMW GB, Roger Glenwright, head of transport at the John Lewis Partnership, and Malcolm Noyle, Government and green fleet development manager at Lloyds TSB autolease.

The document also shows the Government is trying to lead by example, as the fleet of the Government Car and Despatch Agency currently has nearly a third of its vehicles running on LPG or electric power.

  • Copies of Powering Future Vehicles, The Government Strategy: The First Annual Report, are available online at www.dft.gov.uk and via the Useful Stuff sections of this site.

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