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Designing car benefit for the future

13 September 2016
Issue: 4567 / Categories: News

A Treasury consultation explores the incentives.

The Treasury is consulting on the design of new ultra-low emission vehicle (ULEV) bands in the company car tax system. The aim is find out how to incentivise businesses to buy the cleanest cars on the market.

Although views are welcomed on tax bands and rates the consultation is mainly seeking views on the general approach of how company car tax should be levied for ULEVs in the 2020s. It will not signal possible future tax rates because these are set by the Treasury taking into account fiscal economic social and environmental factors.

The main areas for consideration are:

  • Should company car tax bands be refined from 2020-21 to provide stronger incentives for ULEVs?
  • Should carbon dioxide emissions only be used as the basis for new ULEV bands in the company car tax structure from 

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