The British Vehicle Rental & Leasing Association (BVRLA) has urged the government to support fleets with a fair and consistent tax regime amid an ongoing review of the sector.
The industry association warns that failure to support the fleet sector could push more drivers away from company cars, which are typically some of the cleanest on the road, in favour of less-efficient privately-sourced cars.
The fleet sector has already seen the company car tax burden rise by more than £1 billion, or 58%, since 2013 and there are fears of further substantial tax rises on the way.
Company car tax is based on a vehicle’s carbon dioxide emissions and since the introduction of real-world emissions tests for new cars under the Worldwide Harmonised Light Vehicle Test Procedure (WLTP), the official CO2 emissions of popular company cars have risen substantially.
If there is no adjustment, the introduction of a WLTP-based company car tax regime in April 2020 would see the total tax burden rise by £100 million in the 2020-2021 tax year and £400 million by 2023-2024.
In response, the association is highlighting the key role company car and vehicle rental fleet operators play in buying the latest ultra-low emission vehicles.
Gerry Keaney (pictured), CEO of the BVRLA, said: “Our members buy nearly 1.6 million cars each year and are responsible for most ultra-low emission vehicle registrations.
"Most policymakers recognise the vital part that these fleets will play in delivering the government's flagship Road to Zero and Industrial Strategy.
"We need HM Treasury to acknowledge and support the fleet sector's role by providing a fair, consistent and well-signposted tax regime.”
He also warned that the government should not use the shift to WLTP as an opportunity to simply boost Treasury coffers.
Keaney added: “Without making the necessary WLTP-related vehicle tax adjustments, the Chancellor will be simply abusing his position by opportunistically raising taxes and punishing already hard-pressed families and businesses.”
The BVRLA and hundreds of fleet operators have made their views known by responding to a government consultation on WLTP and future vehicle taxes, which closed last week.
The BVRLA has urged the government to adjust future road tax and company car tax bands for 2020 and beyond to account for the increase in WLTP-based CO2 figures to ensure there are no unfair tax rises as a result of the switch.
In addition to these requests, the BVRLA is calling upon the government to provide a legacy company car tax table for pre-April 2020 vehicles, freezing the rates at the 2018/2019 level and providing a four or five-year view of future company car tax and VED bands, enabling fleets and drivers to plan their vehicle choices.
