• B30 Bio-diesel warning
• GETTING TO THE POINTS
• Pre-Budget Report Comment
• BUMPER CARS
• I LIKE DRIVING IN MY CAR… (ON MY OWN)
• HARD DAYS LIGHT
• ANIMAL TRAGIC
• FUEL’S GOLD
• SEEING ‘RED’ OVER HIGH FUEL COSTS
• DRIVING “CONDITIONS”
• MANY HAPPY RETURNS?
• KICKING THE CO2 HABIT
• ‘GREEN’ FINGERS
• FROM AIR TRAFFIC CONTROL TO GROUND TRAFFIC CONTROL
• CULTURE SHOCK
• DON’T DRIVE DROWSY
• ‘FOLLOW THAT STAR!’
• PULLING POWER

• The Darling Budget of March - 08

• Courtesy Cars - March 08
• Green Survey - Feb 08
• New congestion charge angers industry - Feb 08
• Midlands Excellence Award win - Jan 2008

The Darling Budget of March - 08

Comment from Peter Tatlock, Managing Director of Masterlease

For the fleet and leasing industry Alistair Darling’s 2008 Budget was a Spring clean of previous announcements that will continue to focus upon the greening up of vehicle choice and procurement.

But like a newly-demonised plastic shopping bag caught in the recent Spring gales, the Budget lacked substance in terms of the clarity the fleet industry was hoping for as Darling got ‘carried away’ by his own rhetoric.

VED

We have a year’s breathing space before the introduction of the new banding system. This time scale gives the industry time to adapt computer systems and processes to meet the new CO2 requirements.

For the 2009/10 tax year there are to be six new VED bands with A to D, those that boast emissions of up to 130 grammes per kilometre, paying nothing for the first year. This will be paid for by hitting the so-called gas-guzzlers, those vehicles emitting more than 255 g/km with an ‘on-the-road’ VED of £950 for the first year, and £455 for subsequent years. This is aimed at adversely influencing the choice of those who are about to purchase larger vehicles, rather than trapping those who have recently gone down that road.

This will capture the so-called ‘Chelsea tractors’ but could also snare other more fleet-friendly choice vehicles that stray into the 170 and above g/km territory, the larger MPV models for example where the choice for larger families is based upon necessity rather than style or statement.

Although designed to change vehicle buying behaviour, our own order books suggest that this has already been happening with most cars listed now falling well into the sub 165 g/km category. This Budget will no doubt accelerate that behaviour shift.

Capital Allowances

The Capital and Writing Down Allowances (WDA) on company vehicles provided few surprises as there had been much speculation ahead of schedule. The Chancellor had also linked this to CO2 emissions, but we will certainly be seeking urgent clarification from the Treasury as to how this will work. We are not clear if capital allowances here refers to claim backs over a typical three-year contract or, as suggested, into perpetuity. The former would have a negligible impact, but the latter potentially throws up complex accounting issues, moving forward.

On WDA or disallowances, there is no detail in the Treasury notes as to how this will work, so it provides additional uncertainty for the leasing industry and its customers.

AMAPS

Here there was a surprise in that despite a wide-scale consultation any change announcement failed to materialise. Instead, the Treasury has said that AMAPS will remain unchanged. This lack of a conclusive announcement could be linked to disquiet within the public sector for a hike in AMAPS to reflect the mileage of workers including community nurses.  The issue around AMAPS could therefore be becoming more politicised.

For companies in existing Employee Car Ownership (ECO) schemes, it is business as usual, but it does prolong the uncertainty for businesses reviewing their company car policies, especially those who had said that they will delay a decision until the Government makes it feelings known over AMAPs.