Government Tax Hikes Force Owners To Look For Greener Cars

Following the Government’s latest ‘green’ budget, drivers are being forced to switch to greener cars, or accept cash from their employer to lease their own car as opposed to using company car schemes.
The recent budget announcements set a new tax threshold, meaning that vehicles which exceed emissions of over 160g/km of CO2 will be liable for higher charges. According to analysts at the Taxpayers Alliance (TPA), nine out of ten motorists will be affected by higher rates under the Government’s new regime.

The 2008-9 tax system divides cars into categories ranging from band A to G. This is based on how polluting the vehicle is with the most polluting cars being liable for taxation of up to £400 a year and this is a figure which is set to rise.

With the rise in vehicle excise duty Chancellor Alistair Darling also hit workers in company car schemes, where employers provide free fuel and workers pay tax on the benefit. These drivers now face paying hundreds of pounds a year more from 2010 onwards.

The tax is determined using the list price of the car, multiplied by a percentage based on how polluting it is. The current range is between 15% for cars emitting 140g or less CO2 per kilometre and 35% for cars with a CO2 rating above 240g/km.

A lot of company car drivers have decided to opt out of the free petrol because of these high tax costs. Many are finding that it is more cost-effective to lease their own vehicles instead.
Those worst effected by the new taxation are executive car drivers. Select Vehicle Leasing has some of the least polluting, and therefore most cost-effective, executive cars on lease.

These include the greenest executive car around, the BMW 520d, which omits just 136g/km CO2.

To find out more about Select’s range of green executive car leasing options visit www.selectvehicleleasing.com

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