VELO claims the 2.5% tax has resulted in additional costs to fleet operators and has increased the administrative burden placed on insurance companies which has ultimately resulted in premium increases.
Neale said: 'Insurance premium tax has therefore become yet another form of tax on the use of company cars - to add to the pressures already produced by other penalties, such as benefit-in-kind tax. Instead the Government should be encouraging the use of company cars, as they represent a vital cog which helps to ensure that the world of business runs smoothly.' If the Chancellor does raise the tax Neale said a percentage of the money - equivalent to £1 a vehicle - should be diverted into a fund established to fight vehicle crime.
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