Today's PBR statement has confirmed that companies that put electric vans onto their fleets will benefit from 100% writing down allowance.
Dan Jenkins, spokesman for Smith Electrc Vehicles explains what this means.
For companies buying an electric van can write down the full cost of the vehicle against tax in the first year of ownership.
Why is this important?
The UK as a whole is acknowledged as the world leader in the design and production of electric vans.
However sales have been slower because the vehicles are produced in relatively low volumes and are therefore quite expensive.
This announcement will directly create and underpin the sort of "green collar" automotive jobs that the Government wants to see.
And it's not a "jam tomorrow" story like previous Government announcements on electric cars - you can buy a viable, working electric van today.
What the tax incentive will do:
At present, electric vans like those produced by Smith Electric Vehicles cost about three-times as much as a normal diesel van.
They cost a lot less to run in "fuel" and maintenance, but the payback period is long.
By providing tax breaks, the Chancellor is removing this cost barrier - electric vans will still cost a bit more up front, but will very quickly pay for themselves in fuel savings.
So companies with big van fleets can now be green AND save money with electric vans.
Smith Electric Vehicles led the campaign for 100% capital allowances, with management meeting Gordon Brown, Lord Mandelson and several other cabinet ministers over the past few months to press for support.
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