Chancellor of the exchequer George Osborne today announced his financial plan for the country over the next 12 months as part of his Budget 2014 statement – and there was a lot to please the average UK motorist.
Not least the scrappage once again of the proposed 2p per litre fuel duty rise.
Osborne confirmed the fuel duty freeze will continue to at least May 2015, which is good news for drivers.
Compared to the fuel duty escalator planned under the previous labour government, the Chancellor reckons the coalition has saved motorists around 20% on a litre of fuel, which for some cars could be as much as £10 per tank of fuel.
While fuel duty was frozen once again, Vehicle Excise Duty VED, or road tax, will increase once again at the same rate as the Retail Price Index. Effectively, this means another £5 on most VED road tax bands for the year ahead, effective from 1 April 2014.
Despite road tax rates going up, Osborne didn’t elect to penalise zero and low emissions vehicles this time round – so cars that fall under the 100g/km CO2 emissions barrier still attract free road tax rates. Great news if you own a Suzuki Alto city car, for example.
The government also turned its attention to classic cars, introducing a 40-year rolling exemption for vintage vehicles, starting with those registered before 1 January 1974.
Company car tax Benefit in Kind rates also came in for scrutiny, with Osborne hiking the tax banding structure.
Rates will rise by two percentage points a year from 2016 to 2019 in all but two CO2 categories.
From 2017/18 and 2018/19, rates will rise by three percentage points in both the 0-50 and 51-75g/km CO2 output classes.
All though we already knew about it, another classic relic will bite the bullet this year: the paper tax disc.
It’ll be axed from November, marking the first time in 93 years motorists won’t need to display one on their car. The upside is it should reduce costs and drivers will no be able to pay by monthly direct debit.
Osborne specifically referenced the growing pothole problem in the UK during his speech before going on to announce that he’ll be making £200 million worth of funding available to local authorities to repair roads and improve infrastructure.
They’ll have to bid for the money for the repairs, but it’s definitely a step in the right direction.
We want to know what you think of the 2014 Budget statement. Have an opinion on car tax? How will the fuel duty freeze help you? Maybe you’re a company car driver and not too happy about the rise in tax you’ll experience.