UK Treasury encourages van drivers to switch to green fuels

Exchequer Secretary Robert Jenrick unveiled further plans to clamp down on pollution in urban areas. The government has launched a consultation on vehicle excise duty for vans so drivers can be incentivised to go green. Most clean fuel van purchases would pay less tax in the first year as a result of the change.

Less than one in every two hundred vans (0.4%) bought in 2016/17 was an ultra-low emission model. Current legislation sees van drivers pay a flat rate of tax of £250 (no matter what type of vehicle), giving no incentive to choose more efficient alternatives.

This is in contrast to passenger cars, which pay a first year’s rate based on CO2 emissions ranging from £0 to £2,070 and a flat rate of £140 each year thereafter. Pure electric cars pay no road tax whatsoever, while Autogas cars see a £10 reduction.

Therefore, ministers are seeking views on reforms to vehicle excise duty to make it more affordable to buy greener models powered by alternative fuels, including LPG. The consultation will explore creating a graduated first year rate for vans, as is already in place for cars.

“We want to be the first government to leave the environment in a better state that we found it. One of the ways we can do this is by using the tax system to help drivers afford greener choices,” said Jenrick. “We want to help ‘white van man’ go green. We appreciate that buying a new van is a major investment for small businessmen and women and want to help make environmentally friendly choices more affordable.”

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23 May 2018