Green tax hits FDs' car policies

The results of this week’s Accountancy Age/Reed Accountancy Personnel Big Question show the government’s policy of reducing car pollution through tax is having the desired effect.

Due to bite next April, the reforms will penalise those who have larger cars with higher carbon dioxide emissions and remove tax advantages for those who incur high business mileages.

But many FDs expressed anger at the changes. ‘High mileage drivers are being penalised because of the rules,’ said John Buckley, FD of Sauter Automation.

‘Those who have a car as a perk can have cash instead, but those who need a car can’t avoid the high taxes,’ he added.

Chris Baldwin, FD of Godfrey Hall, also expressed frustration. ‘Yet another example of this government’s policy to implement a tax regime that is as harsh as it can possibly muster,’ he said.

However, 53% of those surveyed said they won’t be changing their system.

‘The environment has little effect on choosing a car for senior management,’ said one.

Some companies are not changing their policy because the vehicles they use fall within the emission threshold, or they already use a process that allows their employees to choose the car they use – and therefore the tax rate they will suffer.

The results of the survey shows manufacturers are coming under pressure to make cars which pollute less, including BMW, which is developing hydrogen powered alternatives to petrol engines.

A recent survey for Accountancy Age’s sister publication, Financial Director, found more FDs drive BMWs than any other car.

Links

Details about the tax changes.