How could next weeks Budget affect motorists?


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Posted: 170304
In the latest newsletter from PetrolPrices.com they are looking ahead at what is likely to affect motorists in next weeks budget on Wednesday 8th March. They say that "with record levels of congestion, pollution and cars on the road, there is a sense that something has got to give in the Budget this year. Looking into our crystal ball, we have come up with the four most plausible measures that could be announced by the Chancellor next week.
Measure 1: Further tax increases on high emitting, older diesel cars
Vehicle Excise Duty changes, announced at last year’s Budget, come into effect on the 1st April 2017, which will stop all diesel cars from being exempt from tax, leaving electric and hydrogen cars as the only tax free options when buying a new car. But it seems likely the Chancellor can and will go further than this to try to stop people from thinking of buying diesel vehicles. In line with the recent “T Charge” measures by London, the Chancellor could increase road tax on high emitting or older diesel cars. Another measure could be the outright ban of the removal of DPF filters from diesel cars that are 7 years old or less.

It's likely to happen given failure to meet pollution targets. It will discourage drivers from buying diesel vehicles in future.

Measure 2: Duty on fuel frozen for the 8th year in a row
As mentioned previously, we are unable to find a point in recent history when fuel duty in the UK has decreased. The UK government earns the highest amount of revenue from fuel duty than anywhere else in the world. It seems highly unlikely that fuel duty on diesel will change in any way. Increasing fuel duty would be seen a massive kick in the teeth to the motorist, particularly at a time of high inflation and stagnant earnings.

It's highly likely given recent fuel price increases and inflationary pressures. It does not penalize drivers further, when the cost of fuel is increasing.

Measure 3: A National scrappage scheme for high emitting, older diesel cars of £3,500
Sadiq Khan has called the government to introduce a scrappage scheme for high emitting, diesel cars in London, this follows similar measures in other countries to try to get the biggest polluting cars off the road forever. The Mayor’s argument is that by reducing the deaths and lives affected by pollution each year the net cost is lower from money saved by the NHS and other services. However, it seems unlikely that they will make this change given current budget constraints in public spending and commitments made to HS2, Nuclear Energy and Trident.

It's less likely, massive investment to achieve by a government that doesn’t have money spare. It would be a massive statement of intent and put the UK at front of the world for tackling pollution but it wouldn’t impact HGVs, Public good vehicles and factories, the major polluters alongside cars.

Measure 4: Further incentives to buy zero emissions vehicles
Electric and hydrogen cars already benefit from zero road tax and zero congestion charges; but the Government could go even further to try to make buying a zero emission car more attractive than a high emission car. The Government could incentivize with a help to buy scheme across electric and hydrogen cars that would enable users to buy new or used cars at a lower price, or support with the purchase of second hand electric cars that are currently sat redundant.

It's the least likely of the measures to be announced but may happen within the next few years. It encourages purchase of zero emission vehicles and may stimulate growth. However a tiny proportion of the population will benefit from the measure as petrol/diesel still more attractive".