Eastern Western Motor Group in Scotland
Eastern Western Motor Group in Scotland

What the Budget means for motorists


Posted on Thursday April 2nd, 2015


What the Budget means for motorists

What the Budget means for motorists

A freeze in fuel duty, an increase in Vehicle Excise Duty in line with inflation and additional investment in driverless car development were among the highlights of the Budget for motorists.

1.  The planned 0.54p per litre fuel duty increase on 1 September this year has been cancelled.

2.  Vehicle Excise Duty rates for cars registered on or after 1 March, 2001, will increase by the rate of inflation from 1 April this year.  However, some charges have been held at their 2014-15 levels, notably for lower emission vehicles.

Older vehicles registered before 1 March, 2001, are taxed on engine size and remain unchanged at £145 for engines up to 1549cc and £230 for bigger engines.

The rolling deadline for classic car VED tax exemption will switch to all cars registered before 1 January, 1976, on 1 April, 2016.

VED band

CO2 emissions (g/km)

2015-16

First year rate*

Standard rate*

A

Up to 100

0

0

B

101-110

0

£20

C

111-120

0

£30

D

121-130

0

£110

E

131-140

£130

£130

F

141-150

£145

£145

G

151-165

£180

£180

H

166-175

£295

£205

I

176-185

£350

£225

J

186-200

£490

£265

K**

201-225

£640

£290

L

226-255

£870

£490

M

Over 255

£1,100

£505

*Alternative fuel discount 2015-16 £10 all cars;  ** Includes cars emitting over 225g/km registered before 23 March, 2006

3.  Company car taxation will see a rise by two percentage points for cars emitting more than 75g/km of CO2 to a maximum of 37% until 2018-19, after which there will be rise of three percentage points for 2019-20.  In 2017-18, there will be a four point differential between the 0-50 and 51-75g/km bands and between the 51-75 and 76-94g/km bands.  In 2018-19, this differential will reduce to three percentage points.

“The announcement that Benefit-In-Kind tax rates will rise by 3% in 2019 makes it even more important for businesses to identify vehicles with low CO2 emissions that are both fit for purpose and attractive to drivers,” Andrew Hogsden of Lex Autolease said.

Company car tax 2015-16 to 2019-20

% of  P11D

2015/16

2016/17

2017/18

2018/19

2019/20

0

-

-

-

-

-

5

0-50g/km

-

-

-

-

7

-

0-50g/km

-

-

-

9

51-75g/km

-

0-50g/km

-

-

10

-

-

-

-

-

11

-

51-75g/km

-

-

-

12

-

-

-

-

-

13

76-94g/km

-

51-75g/km

0-50g/km

-

14

95-99g/km

-

-

-

-

15

100-104g/km

76-94g/km

-

-

-

16

105-109g/km

95-99g/km

-

51-75g/km

0-50g/km

17

110-114g/km

100-104g/km

76-94g/km

-

-

18

115-119g/km

105-109g/km

95-99g/km

-

-

19

120-124g/km

110-114g/km

100-104g/km

76-94g/km

51-75g/km

20

125-129g/km

115-119g/km

105-109g/km

95-99g/km

-

21

130-134g/km

120-124g/km

110-114g/km

100-104g/km

-

22

135-139g/km

125-129g/km

115-119g/km

105-109g/km

76-94g/km

23

140-144g/km

130-134g/km

120-124g/km

110-114g/km

95-99g/km

24

145-149g/km

135-139g/km

125-129g/km

115-119g/km

100-104g/km

25

150-154g/km

140-144g/km

130-134g/km

120-124g/km

105-109g/km

26

155-159g/km

145-149g/km

135-139g/km

125-129g/km

110-114g/km

27

160-164g/km

150-154g/km

140-144g/km

130-134g/km

115-119g/km

28

165-169g/km

155-159g/km

145-149g/km

135-139g/km

120-124g/km

29

170-174g/km

160-164g/km

150-154g/km

140-144g/km

125-129g/km

30

175-179g/km

165-169g/km

155-159g/km

145-149g/km

130-134g/km

31

180-184g/km

170-174g/km

160-164g/km

150-154g/km

135-139g/km

32

185-189g/km

175-179g/km

165-169g/km

155-159g/km

140-144g/km

33

190-194g/km

180-184g/km

170-174g/km

160-164g/km

145-149g/km

34

195-199g/km

185-189g/km

175-179g/km

165-169g/km

150-154g/km

35

200-204g/km

190-194g/km

180-184g/km

170-174g/km

155-159g/km

36

205-209g/km

195-199g/km

185-189g/km

175-179g/km

160-164 g/km

37

210g/km +

200g/km +

190g/km +

180g/km +

165g/km +

For tax year 2015-16, add 3% for diesel cars up to a maximum of 37%.  From 2016-17 petrol and diesel cars are treated equally for company car tax purposes.

4.  Employees who receive company-funded fuel used privately will see their benefit-in-kind tax bills rise from 6 April.   The fuel benefit charge multiplier for company cars will increase from £21,700 in 2014-15 to £22,100 in 2015-16.  From 6 April, 2016 the multiplier will once again increase by RPI.

5.  The Chancellor also committed £100 million for research and development into intelligent mobility, which will focus on enhancing the development of driverless car technology and the systems required to implement and adopt the technology, such as telecommunications.  Earlier this year, the Government announced the launch of driverless car pilot schemes in Greenwich, Bristol, Coventry and Milton Keynes.


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