Budget response from Gary Killeen, UK commercial director at GE Fleet Services:

On the modified Benefit in Kind rates:

“By freezing Company Car Tax for all cars below 95g/km in 2013-14 and increasing it by 1% for all cars above, the Government is positing that figure as the new fleet emissions benchmark.

“This is an expected target in line with ongoing Company Car Tax changes. However, it is worth pointing out that fewer than 1% of available cars currently fall into the sub-95 g/km category which gives some idea of the challenge that it represents. Certainly, manufacturers will have their work cut out in providing a wider range of models suitable for fleet use that reach this figure.

“We were also disappointed to see that no clarification has been provided on Company Car Tax rates beyond the 2013-14 tax year. This means that fleets and drivers are today buying ‘blind’ in taxation terms – they have no idea of the tax demands that will be made on them in 2014-15 and 2015-16.”

On fuel duty and free fuel benefits

“The reduction in fuel duty is welcomed and not to be dismissed but is likely to be quickly swallowed up in future fuel price rises. It is interesting to note that the new stabilizer is being proposed at $75 per oil barrel limit but with prices currently above $115, this seems unlikely to ever be triggered, certainly while unrest continues in the Middle East and worldwide demand continues to rise.

“The increase in tax payable on free fuel for company cars has risen from £18,000 to £18,800 and this rise is well below the increase in petrol and diesel prices seen in the last few months in percentage terms, meaning that it will effectively represent a net reduction in most free fuel bills. Governments have been discouraging free fuel provision for years, so is this a change in policy?”

On revised AMAP rates

“The increase in AMAP rates from 40 to 45 pence is worth noting because it is the first such change in many years and, consequently, will help to protect companies that currently operate employee car ownership schemes from increasing fuel prices. However, the increase of 5p per mile only addresses the typical increase in fuel costs over a relatively short period and, therefore, we do not anticipate a surge in new entrants to ECO schemes.

“Also providing welcome reassurance to existing ECO schemes is the news that the Government will not be including them in any future action regarding disguised remuneration, which we believe is a fair and positive development.”

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