Thursday, May 30

Diesel car tax rise in 2017 autumn budget as government plans



The forthcoming Autumn Budget will see buyers of new diesel cars hit by tax rises, according to the Financial Times.

The paper reports that Government aids have said the Chancellor of the Exchequer, Philip Hammond, sees increased levies on sales of new diesel cars as the best route to meeting budget requirements set out by the Clean Air Plan, a draft copy of which was published in May this year. Under the plan, the Government would ban the sale of exclusively petrol or diesel cars by 2040, so that every new car sold in the UK would be electric or hybrid.

The fresh tariffs for diesel cars assuming they’re confirmed when the budget is announced on 22 November will signal a further blow to diesel fuel, following figures released this week that revealed sales of new diesel cars were down 29.9 per cent last month compared to October 2016.

It’s not yet known whether the reported diesel tax increase will arrive by way of a fresh tariff or by a simple VAT adjustment on sales of new diesel cars.

Speaking to the Financial Times, the AA’s president, said: “It is ridiculous to further demonise diesel via differential taxes when drivers are already voting with their wheels. Some 41 per cent of AA members own diesels but that drops. to 16 per cent when drivers are asked what fuel their next car will run on.

King urged the Treasury to concentrate on incentives for greener cars rather than hitting diesel.

Other industry chiefs have voiced similar concerns, with Mike Hawes, chief executive of the Society for Motor Manufacturers and Traders (SMMT) saying falling sales of new diesel cars should be met with urgent reassurance that the latest, low emission diesel cars on sale will not face any bans, charges or other restrictions, anywhere in the UK

That sentiment is echoed by vehicle data specialists cap hpi, who earlier today explained diesel drivers who cover 10,000 miles a year could save £380 annually by sticking with their diesel cars rather than switching to petrol models.