Conference terri::cars_uk

    
    Taken in order 
    
    1. Sounds very likely, and ok by me.
    
    2. Less likely, but a good idea.
    
    3. Certain! 
    
    4. Not in a million years! Imagine the inflationary effect!
    
    Mark

Re .0  - Nice idea.

The financial pundits are suggesting that this year the Chancellor would like
to rake in and extra �1bn, so here's my 2p and his �1bn....


�	1. Greater differential on unleaded/leaded petrol, by increasing
�	leaded duty.
Agreed. 10p/gal?

�	2. Reduced tax on low emission cars. Basically means those fitted
�	with catalytic converters. Less % tax on all cars would favour
�	large cars so may be in the form of a fixed amount.
I don't think he'll do anything, not least because it difficult to
implement.

�	3. Yet more tax on 'Company Cars', presumably by way of increasing
�	the tax penalty. Apart from the financial aspects Co Cars are seen
�	as being big and not very 'green'.
'fraid so. 30% min increase?

�	4. Abolition of road fund licence (old chestnut this one), and
�	a hype in petrol duty to compensate. Seen to accentuate the merits
�	of using the cheaper greener petrol.
I think he'll keep the road fund licence and increase it - this might 
help the government to reduce the total number of cars on the road -
perhaps increasing the RFL to say �200 p.a might help?

R.

I'm told that switching money from road fund licence to petrol excise duty
is not inflationary (since the road fund licence is included in the index, and
apparantely petrol isn't directly).

Further by putting the bulk (or all) of the increase on petrol (not diesel) it
might even reduce inflation (since most delivery trucks and vans are diesels).

/. Ian .\

    
    Problem with both 1. and 4. is that they hit the low income groups,
    pensioners etc.
    Its OK for us with Company cars and reasonable salaries in hi-tech
    jobs but if you implement 1. you hit people who dont have the very
    latest car which runs unleaded and if you implement 4. you hit them
    again (200 quid road fund license would force these people off the
    roads). I'm all in favour of a 'green' budget but we should be
    careful of how it is applied.
    
    Dave

    re .4
    
    Come come.... I drive over 3000mls a year and pay 100 quid for road
    licence. The wife drives less than 10k mls and pays the same. I think
    my 'damage' to road is more than hers, so I should pay more thro' the
    gas i use. maybe the govt might even have more money to invest in
    roads. I can here you all shouting 'how about a decent public
    transport?' thats a different topic.
    Anyway who exactly is a 'low income group'? If they fall into this
    group should they be able to afford cars in the first place? I think
    this is just a 'statistical group' which unions use to get bash govt
    and get inflationary pay with, but then thats another story.
    
    eddie 

    Raising the price of petrol is inflationary.  The chancellor is scared
    of inflation.  Any rise will be small.
    
    Raising the tax on company cars is inflationary.  It encourages
    employers to give higher wages to employees to compensate, or to give
    much higher wages to replace company cars.  I bet this wont stop him
    from raising the tax by 20-50% however...
    
    The chancellor already raises more money by taxation than he knows what
    to do with - he cant spend any of it, cos its inflationary.
    
    
    
    John

Interesting comments....  Various speculations I have seen include:

    1.	The duty differential will increase by a few pence, though not by
	as much as 10p.  Increase of 3-5 pence thought most likely, to be
	acheived by increasing the rate of duty on leaded fuel.
    
    2.	Very easy to implement, as it only applies to new cars.  Most 
	reports say that it must be a flat rate though as a percentage
	reduction will favour large cars disproportionately.
    
    3.	This is bound to increase.  Expect the differential effect for
	larger engine sizes to be increased and maybe the milage bands
	adjusted.  Some people suggest that something may be done to stop 
	the rush to do a high milage in the last few days of the tax year
	to get into a lower taxed band.  One suggestion was that a monthly
	and/or quarterly record of business mileage covered would have to
	be kept and the total mileage spread evenly over a year.  For
	example, if the annual minimum was 18000 business miles, it would
	require a monthly minimum of 1200 miles and/or a quarterly minimum
	of 4000 miles. 
    
    4.	Could be changed to be sensitive to engine size.  This would 
	benefit the less well off as they generally have cars with smaller
	engines.  One suggested scale I saw started at �60 for cars with 
	engines under 1100 cc and ran to �200 for cars with engines over 2
	litres.  It had increases for cars with engines larger than 1.5
	litres and decreases for those smaller. 
    
jb

    
    Yeah, punish all the people with big engined cars!
    
    I'll be quite happy with a reduction in the tax on my 1397cc car
    , thank you!
    
    Mark
    
    PS I suspect that a 3-5p increase in tax on leaded petrol is more
    likely than 10p too.

    How's about extracting more money from the haulage firms?
    
    I remember reading somewhere that one 38 ton truck does about the same
    amount of damage to the roads as about 300-400 cars.
    
    Anyway, what percenatge of the road fund tax actually gets spent on
    road repairs/improvements????
    
    Huw.

>    Anyway, what percenatge of the road fund tax actually gets spent on
>    road repairs/improvements????
 
	Oh no !, please not again, after double de-clutching this one
	gets resurected as well :-}

	Gordon
	

    I use unleaded petrol only because it's cheaper than leaded.  But it's
    laughable how some people are so badly informed that they think
    unleaded is somehow "greener".  (In fact burning unleaded without a cat
    releases more benzine, which is more carcinogenic, and hence more
    dangerous).  I also heard that unleaded uses more CFC's in its
    manufacture, and definitely more energy, since more processes are
    involved.
    
    By all means slash the cost of motoring to those with catalytic
    converters, but any further differential in leaded/unleaded would be
    misplaced.
    
    Jeff.

Let's see, unleaded is cheaper, tax on 5.3 litres goes up, net effect nil.

One happy motorist ..... except we run 5 cars in the family, and guess who gets
to pay all those road fund licences?  Put it on the petrol!!

    
    hear hear! (we're currently running too many cars too!) 
    
    How about a transferable tax disc? You would only need one per 
    'car-on-the-road' :-)
    
    Elaine

    re: .10
    
    Yeah, let's tax double de-clutching as well!! ;-)
    
    I'm reasonably happy with the company car tax, as long as they don't
    tax on BHP!
    
    Mark.

That's OK, mine are measured in Kilowatts!

    
    Is the E-Type a company car then Brian?
    
    What's it cost on the lease scheme and more importantly...
    
    What make are the mats!
    
    Mark

    
    Anybody see that suggestion in the paper the other day, that the
    latest taxable goodie for the Co. Car driver will be parking spaces?
    
    "If your company gives you a place to park your company car, it's
    a perk, so let's tax it.  Now, let's see, at London rates (and isn't
    everything ?), a parking space is worth about the same as a small
    house, so your taxable salary has just gone up by 150,000 pounds.
    Cough up."
    
    BTW, this was a relatively serious suggestion, from a tax specialist.
                                                   
    Then, of course, you're breathing the air over the motorway, so
    that'll cost extra, too.

    Yeah, I'd heard that one as well. Unbelievable! Especially with
    Snamprogetti being so petty about the parking spaces. Hopefully they'll
    tax spaces closer to the front door!
    
    Mark.

    Rathole warning......
    
    The reason they won't do away with Road Fund licensing (whatever the
    annual fee) is because it's a fundamental part of the registration
    system, and the watchdog for the MOT. Money has little to do with it.

RE: .9

I can remember from my under-graduate days that we were told a truck does
approximately 10000 times the damage to our roads compared to a single car.


Regards

Steven

    
    there's probably an algorithm in there somewhere that explains why
    trucks pay 4 times the private car tax...

   Truck damage - arrgghh - I'd ban 'em.  If it weren't for the lorries,
   the roads would just about never wear out. At the moment they last
   less than 15 yrs (1 yr if its the M25) not so :-).

   Still , with the strength of the Road Transport lobby in the House of 
   Commons (for all political persuasions), I don't expect the
   chancellor to do anything.


   I've read suggestions that they might introduce another "mileage band" 
   in the company car scheme with an extra break at 10,000m, the new bands 
   being:

   0 - 2,499; 2,499 - 9,999; 10,000 - 17,999; and 18,000 +.

   Within these bands taxes would be increased
                                                       1.4  2.0  2.0+
   0 - 2,499         + 100% of "norm" instead of +50% (2800/3700/5900)
   2,499 - 9,999     + 30%  of "norm"                 (1820/2450/3900)
   10,000 - 17,999   no change (ie make this the norm (1400/1850/2950) 
   18,000 +          no change (-50%)

   Apparently some 70% of all company car owners fall into the 10,000+
   business miles category and would not be affected by these changes.

   R.

In the last budget, the chancellor stated that he had abandoned taxation on 
company provided parking.

The Inland Revenue were already taxing some people, in London I think.

I don't suppose John Major will hold to such promises however...

Mike.

    
    On the way in I heard there was some suggestion of a two tier
    road tax.
    
    Up to 2 litres :- �75
    2 - ? litres   :- �125
    Big cars 	   :- �150(?)
    
    Whether or not this was a serious suggestion I don't know as it
    was Chris Tarrant and you can't really be sure about any of his
    stories, but it doesn't sound a bad idea, except that it hits the
    private motorist harder than the company car driver.
    
    Mark

    Re: .22
    
    The only thing about truck's is that we depend on them for relatively cheap
    transport of goods.  If you start penalising them we end up paying more
    for the goods in the shops.  Looks like there's no escape - we all end
    up paying for their damage whatever way you look at it..... :-{
    
    -Ruth.

	Re. Trucks

	Without wanting to open up a political rathole, well I can't really
	help it on this issue ! One of major reasons there are so many trucks
	on the roads today is because of the appalling rail system in the
	UK. If some of the larger canals were also utilised for bulk transport
	this would help as well.

	I'm not bashing B.R, too much, on this point because they have'nt got
	the kind of government funding that the French,Dutch and German railways
	get from their respective governments. 

	In the above countries the number of HGV's is markedly less and roads
	,in general, don't need repairing so often. I can't see the governments
	stance on the railway system at all. The taxpayer is probably paying
	as much , if not more, to support the amount of goods being transported
	by road, rather than using government money to invest in the rail
	network.

	Well, nuff said !

	Gordon

    One of the reasons why there are less trucks on the Roads in France
    in the Tolls imposed for EVERY journey.  It then becomes cheaper
    to send it by rail. (also the distances are larger).
    
    But, Gordon, if i remember correctly, you are opposed to toll roads in
    the UK.
    
   Nigel 
    
    

	You might remember correctly, I don't remember being opposed to
	toll roads in the UK though, oh well. As long as they don't 
	introduce them in The Netherlands I'm not too bothered, as I only
	visit the UK a couple of times a year with the car.

	

	Gordon

  And you should see the company I keep in the passenger seat!  Plus, as far as
  I'm concerned, it's still less than 3 years old (I bought it less than 3 years
  ago that is!).

  On the other hand, I am opposed to all and sundry getting "company" cars and
  even when I was in field service support failed to see how I could really
  justify receiving the payment for one as my annual mileage was so low.  I took
  the money of course as to try to not to would have messed up the system 8^).

  As far as lease cars are concerned, they are a personal choice and a perk
  which you are not forced to accept.  I would never enter any lease scheme I've
  ever seen as I have never been able to cost-justify doing so - except when
  income tax rates were over 50%, in which case there was a definite cost break.

  Brian

We basically need a better infrastructure for our goods and our commuters.
A combination of rail and trucks for long and short journeys, and rail and
busses, etc for the commuters.

Steven

    I think you will find that the Police would not be too keen on
    scrapping road-tax, as this is the only way ( be it not too effective)
    that they can ensure that the car at least HAD an MOT when it applied
    for the tax. This way, it is recognisable, and at least some of the
    time the car is roadworthy.
    Carl.
     

    re:29
    
    *Some* lease cars are not an option, they are mandatory. You have to
    have a car, and cannot opt out of the scheme. Personally I don't mind,
    but then my car only costs me tax plus what I choose to contribute
    over-and-above the base supplement.
    
    What will really dismay me is if the chancellor penalises me for having
    a tool required for my job. It's certainly a personal benefit, and I
    don't mind paying tax on it. But if the tax starts to cost more than
    running my own car would, I'll be miffed. I support the idea of a
    graduated scale based on mileages, but that should mean graduated and
    NOT stepped, as suggested above.
    
    
    Colin
    
    Whoever you vote for, the government always gets in, and the chancellor
    always gets your cash !!

    re: .31

    Why not just replace the road-tax disk with an MOT disk ... a bit
    like the German system.
     
    Mark

Or, have what the Swiss have - where the number plate belongs to YOU, not the 
car. They know everything about you - state of insurance, whether you've paid
you're tax, whether car has been tested recently, whether its passed its annual
"breath test"..... - and the police are such a friendly bunch!

    Or why not just go for a French-type system, where cars are taxed
    according to age of the vehicle, its "fiscal horsepower" and the
    D�partement in which it is registered (ie Paris itself is more
    expensive than Parisian suburbs).  
    
    In practice this means that if you've got a spanking new XXX litre
    car registered in Paris you pay a fortune for it, but if your neighbour
    has a worn-out 15 year old 2CV, he pays almost no road tax.  I believe
    cars over 20 years old are exempt from road tax.  Roll on the days
    when I can afford my DB5!
     
    Needless to say, the rules are made by the French and to benefit
    the French motor manufacturers, with the fiscal hp bands being
    determined to suit Citro�n/Peugeot/Renault and to disadvantage owners
    of cars in the higher brackets (the French don't produce anything
    over ?cc).  
             
    It is said (and I've no proof) that a certain number of owners of large
    engined foreign cars registered in Paris are refusing to pay road
    tax this year and threatening to take the French state to the European
    Courts because this tax is discrimination against foreign cars.
    They won't win - France makes the rules there too ...
    
    Jacquie
                                   

    
    Cars over 20 years old exempt? GREAT! 
    
    Mark

Yeh, but not with big engines or foreign - so the "E" loses out on both counts!
But then who'd be daft enough to keep an "E" in Paris?  Probably me!

    The story so far...........
    
                        BUDGET 90
                                        1989       1990
     MOTORING                       
             /GAL              4*       1.89     +11.00
                      2* UNLEADED       1.79      +9.00
                           DIESEL       1.69      +9.00
                        ROAD FUND     100.00     100.00 no change

     PERSONAL TAX                                +7.70%
                           SINGLE   2,785.00   3,005.00
                  MARRIED ADDIT'N   1,590.00   1,720.00
                         MORTGAGE  30,000.00      nothing yet
                  HIGHER TAX BAND  20,700.00  20,700.00
                   LOWER TAX RATE     25.00%     25.00%
                  HIGHER TAX RATE     40.00%     40.00%


  COMPANY CAR TAX
                       THRESHOLDS INCREASE      +20.00%
                           0-1400   1,400.00   1,680.00
                        1400-2000   1,850.00   2,220.00
                            2000-   2,950.00   3,540.00
                                    3,850.00   4,620.00
    
    Richard

    Thanks for that.  Is there anyone who knows how to translate these into
    hard cash terms?  Like, the increase threshold for less than 1400cc,
    what does that mean in pounds per month?   Does it mean I shoiuld get
    rid of my lease car?
    
    Mikef
    

    The figure given is taken AWAY from your tax allowance so for most
    purposes you can say you'll pay 25% of that figure as tax.
    
    Richard

    The tax payable is 25% or 40% as appropriate of the benefit assessable,
    so the tax goes up by the same %age as the ben. ass. does.  I've not
    brought a radio or TV in but if the 20% increase mentioned is correct,
    the tax on a sub-1400cc car at 25% tax rate goes from �525 to �630
    (under 2,500 business miles),  �350 to �420 (2,500 to 18,000 miles) and
    �175 to �210 (over 18,000 miles).
    
    I dunno whether this means you should get rid of your lease car are
    not... 
    
    Jon
    

    So I used to pay 525 in tax per year, now I pay 630...which is 52.5 per
    month as opposed to 43.75.  Hmmm, 9 per month extra.  ( sorry, can't
    get my pound key to work).  I dunno. I'll wait and see how much my new
    quote is, sinc e my poor fiesta was destroyed in the Cres fire.
    
    Mikef

    Single person's allowance   -  �3005
    2l car, <2500 miles p.a.    -  �3330

    Do I end up with a negative tax allowance, or one of zero?
    If it's negative, how does it operate?
    
    Andy    

    
    I've already got one..... 
    
    TAX CODE = OT
    
    Personal allowance = -135 (definitely negative) 
    
    Yearly payment direct to HMG.

    Yuch.
    

I don't believe it is strictly true to say that the car "equivalent value" is
"taken off" your personal allowance.

Every year Digital, being friendly and law abiding, send the tax men a form 
stating exactly what additional benefits you have received. I believe this lists
the car (giving engine cc and price) so that the tax man can charge you the
appropriate tax ...

Now the question that interests me is about the �19250 price barrier - exactly
what price is used: the makers list price? the discounted price paid by 
PHH/Hertz? the price including delivery charges? including or excluding optional
extras?

If it is the price paid (discounted) by Hertz then it gets very difficult to
decide what bracket you chould be in, for they may pay �19000 (under the
threshold) for a car listed in the showroom at �21000 (over the threshold).

/. Ian .\

	I would imagine they probably refer to the 'Book Price'. Otherwise
	all kinds of under-the-counter dealing could be done and the tax
	people are'nt that daft.

	That's what they do in Holland. I was offered an new 'old' style
	300ZX at Fl 70,000 compared to it's 'Book Price' of over Fl 90,000.
	Not that I was interested anyway, but for tax purposes, I would have
	been taxed on the 'Book Price' and not what I actually paid for it.

	It could be different in the UK, but, from the tax man's point of
	view, it would seem the easiest way of doing it.

	Gordon

Isn't "value" the key word here?  Whatever Hertz/PHH pay for aa �22000 car,
its value is still �22000, so that is what you are taxed on.

Jc

    I'm pretty sure that -1 is right. A friend of mine just bought a second
    hand Carlton GSI 3000, and he had to get a garage to write and tell the 
    taxman that it's value was under �20,000.

    I believe the price threshold is for the "book" price minus VAT.

    I have just recently specifically asked a taxation advisor about this
    issue. His reply was that it is the price PAID by the purchasing
    company. It bears no relation to the value, book price or anything
    else.
    
    So if PHH/Hertz say they paid less than 19250 then you get charged on
    the appropriate other scale.
    
    Stupid if you ask me, but there you go. 
    
    Geoff

    The quote from the Garage is "the invoice price". The interesting thing
    is that they take the full list price, add VAT and Car tax, then take
    off the PHH negotiated discount from the base price. That ends up as
    the invoice price and that is what we report to the Inland Revenue.
    e.g. imagine a 10k base price car and car tax and vat come to 20%. Also
    imagine that PHH get a 10% discount. The calculation is as follows :-
    
    Base 10k	Tax 2k	Discount 1k(from base)	Total 11k.
    

    A new question.......
    
    Now that we've all agreed (-: that diesels are cleaner (oops let say
    "less polluting") and more economical and run on cheaper fuel....
    
    It's seems also to be true that to get resonable performance, a diesel
    has to have a larger CC than it's petrol equivalent.....
    
    So why does the CC rating for tax breaks not differentiate between
    diesels and petrol engines. For my money getting below the 2000cc limit
    in a petrol engine is relatively easy. However you might just get me to
    go to a diesel if the same break was available on diesels below 2500cc.
    
    Seems reasonable to me, or is my "logic" all screwed up?
    
    JK
    

    Sounds logical to me, John. There was a rumour going round (started by
    Ford, I think) that at a recently past Budget the Chancellor was going
    to announce just what you suggest: an offset in the allowance cost for
    diesel vs. petrol vehicles. Translates to >2000cc diesel = 1400-1999cc 
    petrol, 1400-1999 diesel = 1100-1399 petrol or whatever the current
    breaks are. Can't see much of a problem in that as there isn't that
    much difference between the cost of diesel and leadfree these days.
    Perhaps it's the greater economy of the diesel engines that skews the
    chancellors rake off from us that makes it a no-no. Anyway as we all
    know, it never happened. But I agree with you that if it did happen it
    would almost certainly make me a diesel driver.

    
    When the chancellor changed the tax-breaks on engine sizes a couple
    of years ago, he did it to come in line with Europe.

    I imagine that Europe would have to make any new amendments and
    we would just follow?