Personal allowance up from £4,535 to £4,615. Increase in 10% starting rate over personal allowance from first £1,880 of earnings to first £1,920. Basic rate unchanged at 22%, but limit rises from £29,400 to £29,900. Higher rate unchanged at 40%, but starting point now £29,901.
Fuel tax
Freeze on duty for petrol, diesel, liquefied petroleum gas and compressed natural gas.
New duty rate for biodiesel will be 20p per litre below duty on ultra-low sulphur diesel. Hydrogen fuel becomes duty free for a limited time to encourage fuel cell development. New fuel duty incentives for low-sulphur fuels planned from 2003.
VED rates
Duty rates frozen at current rates for the next year. Introduction of new 'super green' VED band, offering £30 reduction for cars with emissions of less than 120g/km. New VED bands for motorcycles, based on engine size, to encourage use of smaller engines. Cut of £55 in duty rate for low emission vans that meet Euro IV.
Fuel scale
New CO2-based fuel scale charge proposed from April 2003, designed to tax drivers on the benefit according to the emissions of their company cars.
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