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Budget: Motoring

Diesel owners to expect tax penalties

fuel duty carsDiesel car owners are to be hit with further tax increases if their car doesn’t meet the required standards.

Vehicle Excise Duty will rise, meaning those cars that are not up to scratch on fuel emissions will go up one band and the existing diesel supplement in Company Car Tax will increase by one percentage point.

However, Philip Hammond was keen to highlight “no white van man or woman will be hit by these measures,” as it’ll only apply to cars.

But car finance expert Graham Hill was sceptical about the Chancellor’s motives behind the move.

He said: “It’s hard to see whether the Chancellor’s further squeeze on diesel drivers is out of genuine concern for the environment or just a way to increase revenues from already overtaxed motorists.

“The announcement of a first year VED rate hike on new diesel cars from April next year is designed to sidestep headline-grabbing increases on other motor vehicles like vans, but it still adds to the negative narrative that is talking the automotive market down.

“In the run-up to the Budget, new and used car sales of diesels have suffered significantly – which has had a wider effect on the new car market as customers hold off on purchases in the hope that values recover.

“At this rate, we risk talking the car market into serious trouble.”

Meanwhile, there were further measures announced to encourage more economically friendly transport. These include extra funds and tax incentives for electric car users, which come in the form of a £400m charging infrastructure, and extra £100m Plug-In-Car Grant and £40 million for research into charging.

Mr Hammond also said he would look in to how to tackle plastic waste saying; “I will investigate how the tax system and charges on single-use plastic items can reduce waste.

“Because we can’t keep our promise to the next generation to build an economy fit for the future unless we ensure our planet has a future.”

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