15 December 2017
November’s Budget 2017 was one that the Chancellor didn’t have much wriggle room, with the uncertainty at the time of the Brexit bill, continual pessimism around the long term growth of the economy and further demands on the country’s coffers from the public and education sectors.
The biggest headline grabbing note surrounded first time buyers and Stamp Duty land tax. However, the automotive sector did also get a few mentions, including the continual demonising of diesel cars, when only 15 to 20 years ago they were heralded as the way forward.
The Budget provided for the following:
- Vehicle Excise Duty (previously Road Fund Licence) for cars, vans and motor cycles registered before April 2017 to rise by inflation.
- Vehicle Excise Duty for new diesel cars not meeting the latest standards to rise by one band in April 2018.
- Existing diesel supplement for company cars owners to rise by 1% to 4%.
These announcements were seen by many as being a soft touch and a slight nudge to consumers to steer away from polluting diesels. The counter argument is that it will encourage people to retain their old, dirtier vehicles for longer, rather than replace them with newer ones. Only time will tell on that point.
The other more persuasive points involved the promise to provide £540m to support the growth of electric cars, including the provision of more charging points and subsidies to encourage the purchase of electric cars.
It feels to me like we are starting to get to a turning point in the sector, with a definitive move against diesel and a shift to the promotion of electric. Whether the measures announced will result in a major sea change in public use of these vehicles, again only time will tell. It does appear however that access to electric cars and their charging points are the two major stumbling blocks in the Government’s desire for more widespread use of electric vehicles, so if their resolve allows for more access then maybe, in a decade, the Budget will no longer pay much attention to this area.
I should point out that at the time of writing the November Budget is yet to be published into the Finance (No2) bill 2017 and so matters may change before any of the above is actually enacted into law.
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