The Government has again failed to provide future benefit-in-kind clarity for company car drivers and organisations, with last week’s Spring Statement going no further than to say a Government response following the review into the impact of WLTP on company car tax and VED would arrive “in the coming months”.
“Philip Hammond (pictured) would probably say that the Spring Statement is not a time for big announcements. However, there is one big announcement that he should have made today but didn’t: the rates of Company Car Tax for 2021-22 and 2022-23,” said Leaseplan head pf consultancy Matthew Walters. “It’s outrageous that we weren’t told these rates years ago, and yet we’re still waiting. This means that fleets and motorists cannot properly prepare for the years ahead, which is particularly worrying at a time of such economic uncertainty. The Chancellor needs to reveal the rates as soon as possible – preferably even ahead of this summer’s draft Finance Bill.”
Lex Autolease head of consultancy Ashley Barnett (pictured below right) was another warning of the dangers of delaying clarity for the company car industry.
“Without guidance on how WLTP will affect company car tax rates, we run the risk of contract holders deciding not to renew, and more people opting out of their company car schemes in favour of a less-regulated grey fleet environment,” he said. “Fleets have a critical role to play in pioneering the newest, cleanest vehicle technology, so it’s important that the knock-on effects of the WLTP transition don’t make company vehicles seem like a less attractive option.”
“The lack of long-term company car tax tables is holding the fleet market back – we had hoped for an update from the Chancellor today,” continued Barnett. “Before fleet decision makers can build a strategy based around the average 48-month contract, and before employees can commit to what is essentially a four-year investment, they need assurance that the associated costs are not going to increase over its lifetime.”