BUDGET 2011: Fleet highlights
The key points from the fleet operator's perspective are as follows:
There will be a 1p per litre cut in fuel duty from tonight, 23 March while the inflation-only fuel duty rise for 1 April will be postponed until 1 January 2012. The 2012-13 duty rise will be effected on 1 August 2012.
The fuel duty escalator will be abolished and will be replaced by a fair fuel stabiliser, which will kick in when oil prices reach $75 a barrel. This will be funded by an increased levy on oil and gas production, from 20% to 32%.
Company car tax:
The Government announced the 2013/14 BiK rates, which will rise by 1% for cars with emissions from 95g/km to 219g/km. The 10% (13% for diesel) rates for vehicles with sub-95g/km have been frozen to help encourage the take-up of low-carbon cars while there is a new 5% rate for ultra-low carbon cars with less than 75g/km. However, the 3% diesel surcharge has been retained despite lobbying from organisations such as the BVRLA.
NICs and income tax
The Government is to consult on the merger of these to make the tax system 'fit for the modern age' and to simplify it.
Passenger car VED rates:
These will rise in line with inflation and will bring about increased first-year and standard-rate costs for cars with 131g/km of CO2 and higher.
With effect from 6 April 2011, Approved Mileage Allowance Payments (AMAPs) rates are to increase to 45 pence per mile for the first 10,000 miles and remain at 25 pence per mile thereafter. This is the first change to the rates since 2002.
The Government is to increase the 2011-12 fuel benefit charge in line with inflation. The change will take effect from 6 April 2011 and will see the fuel benefit charge rise from the current level of £18,000 to £18,800. This will affect drivers through increased taxation while fleets will pay increased NICs on the benefit.
The Chancellor announced that the van benefit charge is to be frozen at £3,000 in 2011-12 while the van fuel benefit charge is to be frozen at £550 for 2011-12.
Last but not least an extra £100 million has been allocated to fill potholes in England, Scotland and Wales.