LEADER: BIK rise jeopardising EV boom
Increasing benefit-in-kind tax on electric cars will hamper ambitious government plans to become the EV world leader, the Association of Car Fleet Operators (ACFO) have warned.
Company car benefit-in-kind tax on zero-emission vehicles will rocket by 500% in 2015/16, with a further rise due in 2016/17, HM Treasury have decided.
Zero-emission vehicles are currently 0% rated for BIK, but ACFO’s Electric Vehicle Seminar heard the rise to 5% would hit fleet uptake.
The warning comes as corporate demand increases, and ACFO are calling for the government to reconsider the rise in their Budget Statement next month.
Phil Redman, Director at ACFO, said: “ACFO has put pressure on the government and we want fleet managers to do so as well.
“The tax rises should not be coming in before 2020 to enable electric vehicles to become established.
“We need to remind HM Revenue and Customs that electric company cars are on long-term retention, perhaps four, five or six years.
“To establish the market, the tax rise should be delayed and employees also need to know the tax position well into the future so as fleet managers we can convince them that they are the right vehicles to have.”
The British Vehicle Rental and Leasing Association (BVRLA) also insisted in their Submission the government should use the Budget to encourage business EV take-up.
They have also advised making a car’s P11D value inclusive of the Plug-in Grant, reinstating the First-Year Allowance for leased ULEV, supporting workplace chargepoints and capping Approved Mileage Allowance Payments at 3,000miles.
Gerry Keaney, Chief Executive of the BVRLA, said: “The Budget is the perfect opportunity for the government to prove it is committed to driving the take-up of ultra-low emission vehicles.
“The suggestions we’ve made will increase business take-up of efficient cars and vans, and enable the government to meet its goal of moving the car fleet in this country to ultra-low emission vehicles by 2040.
“BVRLA members are responsible for buying nearly half of all new vehicles sold in the UK every year and it is vital that the government supports this sector by encouraging sustainable business transport.
“The take-up of ultra-low emission vehicles will be a marathon, not a sprint, but where the rental and leasing industry leads, the private sector will follow.”
