The British Vehicle Rental and Leasing Association (BVRLA) and ACFO have both called on the government to clarify details of the capital allowance rules for fleet cars in the 2008 Pre-Budget Report, which is due to be announced by the chancellor Alastair Darling next month.

ACFO said fleet decision-makers are confused and concerned about the changes, which come into force in April 2009.

The key figure under the new rules is 160g/km of CO2.

“Essentially, the complex new rules will make it more expensive for companies to run vehicles over 160g/km irrespective of whether they lease or buy,” said an ACFO statement.

“Current projections indicate that the post tax net effect could see ‘effective’ costs for a company car increase by £20 per month or more on vehicles emitting over 160g/km.”

Alison Chapman, lead tax partner of the Deloitte & Touche Automotive Sector Group said: “The changes mean that every single model has to be examined for its tax impact.

"Employers who do not review their policies could well find the depreciation and funding elements of their fleet costs increase by up to 15% as a direct result of these changes, whether they lease or buy.

"It is likely that leasing may prove more attractive for some models.”

In a consultation with the Treasury, the BVRLA asked for clear guidance that will enable businesses to plan their vehicle funding and acquisition strategy.

It said confusion remains over the transitional rules – businesses need to know how long cars purchased or leased before April 2009 will be ‘grandfathered’ in the current regime.

The association also said businesses need confirmation that only the final customer in the lease chain is subjected to a lease rental restriction (LRR).

This would remove the current, unintended consequence of the proposed tax review, where all the parties in a lease chain are hit by the LRR.

“Clearly the current economic climate rules out any significant reduction in motoring taxes,” said BVRLA director general John Lewis.

“But by giving us some clarity on its tax strategy, the government can help businesses plan with a bit more confidence during these turbulent times.”

The association also said the chancellor should remove the “unjustified” 3% diesel supplement from company car and fuel benefit-in-kind taxation.

“With today’s modern diesel engines there is no justification for a 3% supplement in BiK taxation.

"The government has already got rid of the diesel supplement in VED, it needs to do the same with company car tax,” said Mr Lewis.

“The emphasis here is fairness, not tax cuts.

"The Government can do what is right and still maintain its overall tax revenues by recalibrating rates.”

Julie Jenner, ACFO chairman said: “Uncertainty rules among fleet decision-makers over the corporate tax changes and that is not good.

"ACFO has repeatedly urged HM Treasury in face-to-face meetings for clarity and to allow time for new measures to be implemented.

“Companies will shortly be ordering new cars that will not be joining their fleets until after the new rules come into effect.

"Therefore, it is essential that HM Treasury clarifies all issues so crucial vehicle-related decisions can be made in confidence that the most cost-effective and environmentally-friendly vehicles are chosen.