Budget 2012: Fuel Duty Will Rise; Van Benefit Frozen

Today’s budget contained few surprises for van operators – here are the highlights:

  • No change to fuel duty plans – this means that the planned 3p/litre increase in September is likely to go ahead
  • Van Benefit frozen – the benefit-in-kind charge on private use of company vans will remain unchanged at £3,000 for the 2012/13 tax year, meaning those on the 20% basic rate of income tax pay £600 and those on the 40% rate pay £1,200.

The Van Benefit charge applies to van operators using a commercial vehicle (including pickups) with a payload of at least 1,000kg for private as well as commercial use.

The Chancellor also confirmed that the Van Fuel Benefit Charge (FBC) will remain unchanged at £550 for the 2012 tax year and will rise in line with inflation from April 2013.

The FBC exemption for zero carbon emitting vans will continue until April 2015, as previously planned.

Updated 1945:

John Lewis, chief executive of the British Vehicle Rental and Leasing Association (BVRLA), had this to say about today’s announcements:

“The fleet sector is the only part of the new vehicle market that is still growing at the moment. It will adapt to the new tax regime as it always does, but these ambitious targets could bring a temporary stall to the market as businesses re-evaluate their fleet policies.”

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