The Association of Fleet Professionals has renewed its call for the government to publish Benefit-in-Kind taxation tables for electric vehicles through to 2030.
At present, BIK rates are only available up until the 2024/25 tax year and it warned this means businesses and company car drivers are now entering into four-year cycles without any indication of the rates for 2025-26.
“We’ve been banging the drum about this for some time, that to make the Government’s 2030 electrification deadline workable, we need to have corresponding benefit-in-kind tables in order to strategise effectively. Many fleets, including AFP members, have long-term plans in place predicated on meeting that date but it is clear we need a stable and predictable taxation environment in order to do so,” said Paul Hollick, the AFP’s chairman (pictured below).
Hollick added that while he recognised that electric BIK rates are likely to rise, but called on the government to do this in a ‘transparent and graduated manner’: “As EVs become the dominant power in company cars, which we expect to happen around the middle of this decade, the government could reasonably move to reduce the incentives attached to them or look to other sources of taxation in order to maintain revenue. That makes sense but it needs to be done in a planned and responsible manner.”
“What we very much want to avoid is a potential situation where the Treasury of the time suddenly realise that the company car parc is perhaps 60% EV at some point in the mid-late 2020s, and push up benefit-in-kind substantially. That would be unfair on individual drivers, we believe, and also threaten the responsible, committed long-term electrification plans that many, many fleets are pursuing, including our members. The current, four-year cycle issue is the leading edge of a potential problem that is only going to get bigger,” Hollick concluded.