LEO Pharmaceuticals has minimised negative impact on employees from the introduction of the new carbon dioxide-based company car tax with a coordinated campaign of education and information.

Di Rees, the company's business services manager responsible for a fleet of 170 vehicles purchased outright, began preparing for the changes to benefit-in-kind taxation two years ago.

She issued drivers with an outline of the new tax system detailing how it would affect their individual tax bill as well as a list of useful websites.

'As a result, our drivers are very aware of the implications of their choices of company car and that is being reflected in the cars that drivers are choosing,' said Rees.

Rees is encouraging drivers to opt for diesel-powered vehicles because they typically produce lower CO2 emissions than their petrol counterparts and, as a result, should help to reduce a driver's tax burden under the new system (despite the 3 per cent penalty imposed on diesel).

Rees said: 'The people who will be worse off under the new company car tax system will be the high mileage drivers. Even if they move into a low-emissions diesel they will still go from paying 15 per cent to 18 per cent because diesel vehicles carry a 3 per cent penalty from April 2002.

'But the drivers who are currently paying tax at 25 per cent of a car's list price are likely to be better off.'

Although the majority of Leo Pharmaceuticals' fleet consists of essential business drivers, the company does have some perk drivers who have the option of a cash-for-car scheme.

At the moment, very few drivers have opted-out of their traditional company cars, and while Rees expects this number to increase slightly, she is not anticipating a huge number of drivers taking the cash option, despite the fact that Leo Pharmaceuticals has no intention of compensating drivers who find themselves out of pocket because of the changes to benefit-in-kind.

Rees admits that giving drivers the opportunity to opt out of company car schemes can raise a number of health and safety issues, creating difficulties over ensuring vehicles are serviced regularly, properly insured and are roadworthy.

The changes in company car tax mean that drivers will no longer have an incentive to clock up more business miles and to support this environmentally-friendly form of taxation Rees has set up a number of 'green' initiatives for the fleet, including improved route planning and car sharing.

And she has not ruled-out the possibility of bringing alternatively-fuelled vehicles on to the fleet. 'If drivers want a liquefied petroleum gas vehicle they can have one. But I think many drivers are uncertain about making the move to LPG because there is a small infrastructure of refuelling points,' said Rees.