Transport – Tories criticise travel benefits

Tories are planning to highlight inconsistencies in the benefits-in-kind concessions connected with travel to work.

Attacks being prepared by Tories on the Finance Bill committee over the next week will target the ‘can of worms’ opened by chancellor Gordon Brown when he moved to address green concerns over travel in the Budget.

Former Treasury minister Michael Jack said that the difficulties in allocating the benefit of a company-provided bicycle highlighted the problems that lie ahead.

For example, using the bicycle to travel to work is to be a tax-exempt benefit – but what about the tax treatment when a worker detours on the way home for a brief shopping trip?

Jack said the issue becomes material where the Finance Bill lays down a minimum of 17 seats for tax-exempt commuting by minibus. He said that Conservatives on the committee will want to know why an eight-seater fails to qualify.

The Tories will also highlight the situation in London and some other major cities where employer-provided bus travel is not so green.

It would be more environmentally friendly for an employer to provide staff with free public transport season tickets than to run buses for any distance in the capital.

This would be a huge and very expensive concession that the Treasury has no intention of conceding – whatever the merits on environmental grounds.

Jack is not arguing for a huge extension to the travel concessions, but he and other Tory backbenchers are determined to probe the point where principle is abandoned in favour of revenue.

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