Although some announcements were made, such as the changes to Vehicle Excise Duty to penalise high-emitting and incentivise cleaner cars and inflation-linked rises in fuel duties, chancellor Gordon Brown sidestepped the major issues, meaning more uncertainty for fleets and suppliers.
A spokesman for fleet managers’ association ACFO said: ‘It’s a major disappointment that after at least a year and two sets of wide-ranging consultations, Her Majesty’s Revenue & Customs is still not able to offer a clear strategy on how it may, in future, deal with ECOS and AMAP arrangements.’
The government is concerned that the current situation with ECOS encourages drivers to drive more miles in order to maximise the benefit of mileage rates, flying in the face of its strategy to encourage greener travel.
But despite consulting the fleet industry extensively, it has yet to come to a conclusion about whether this is the case, leaving firms with ECOS, and suppliers selling them, waiting to see if circumstances will change.
Richard Schooling, commercial director of Alphabet, which has a number of ECOS products, said: ‘It’s always better to be consulted than be dictated to.
‘But this business of extending and re-extending consultations on key fleet issues is becoming something of a budget habit. The budget has put many firms’ fleet policy development plans on hold.’
Experts believe that when changes do finally come, AMAPs will be linked to CO2 emissions.
Jim Salkeld, managing director of ECOS supplier Opticar, said: ‘The review has not resulted in any conclusions but this is not surprising given their complexity and variety.
‘If the proposal is to consider the alignments of AMAPs to emissions, this would probably not be unwelcome to employers, although the actual numbers would have to be examined quite closely.’
However, a fillip for ECOS providers was found in Mr Brown’s 2% reduction in the standard rate of income tax, taking effect from April 2008, which will reduce the tax and National Insurance Contributions for ECOS drivers.
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