Our thoughts on the Chancellor’s Autumn Budget Statement
Overall, the Autumn Statement was a rectification of an ‘economy in crisis’ with a clear focus on a more environmentally conscious Britain, benefitting the responsible driver.
Company car tax
With the retention of the three per cent diesel supplement in company car tax until 2021 raising an additional £1.36 billion, the determination to meet air quality standards was clear.
Ultra-low emission vehicles
Although the Government is yet to announce the new structure of the Plug-In Car Grant set for next year, the desire for the corporate sector to drive demand shows a progressive outlook on the future of mobility with ultra-low emission vehicles at the centre. Evidenced by a commitment to spend more than £600 million over the next year and between 2020/1, the support for uptake and manufacturing of these vehicles is promising.
Consecutive Budget and Autumn Statement announcements have included a warning about the popularity of salary sacrifice schemes and their impact on the government’s tax take.
The Chancellor told the House of Commons in his latest Statement: “The government remains concerned about the growth of salary sacrifice arrangements and is considering what action, if any, is necessary. The government will gather further evidence, including from employers, on salary sacrifice arrangements to inform its approach.”
Benefit charges 2016/17
One element of the statement relating to benefit charges for 2016/17 may not be kindly received, with employees in receipt of company-funded fuel seeing benefit-in-kind tax bills rising from April 6 next year for private use. The fuel benefit charge multiplier for cars is set to increase from £22,100 to £22,200, with van fuel benefit charge multiplier increasing by only £5 from 2015/16 to 2016/17 and the van benefit-in-kind tax increasing by £20 in the same period.
Another interesting announcement is the end of the right to cash compensation for minor soft tissue injuries for those exaggerated or fraudulent whiplash cases. To accompany this, more injuries can go to the small claims court with the upper limit increasing from £1000 to £5000. The resulting saving in annual insurance costs, which is calculated to decrease annually by £40 - £50, shows a sense of gratitude to the responsible driver.
Road Infrastructure and maintenance
‘Building for the future’ is a key theme projected throughout the statement, with significant government investment in Department for Transport, plans to spend over £15 billion on constructing new roads and £6.9 billion on road maintenance, including a permanent pothole fund, over the next five years. As the biggest investment for 45 years, the Roads Investment Strategy is set to include resurfacing of over 80 per cent of the road network and deliver more than 1,300 miles of additional lanes.
Although the benefit-in-kind tax bills are rising, it is good to see such a forward-looking statement aiming for zero emissions by 2040, a conscious effort to improve the supporting infrastructure whilst complimenting responsible drivers – an encouraging future for sustainable business mobility.