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In the Budget on 21 March
2000, the Government announced the new regime affecting the taxation of company
cars to apply from 6 April 2002. The existing regime that encourages company
car drivers to drive unnecessary miles is to be replaced by a system that
encourages the use of more fuel efficient vehicles.
This tax calculator
compares the existing regime to the new regime in order to provide you with an
indication of how the changes affect you. The Government's proposals are as
follows:
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List price still to be used as the basis of the taxable
benefit calculation
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Business mileage discounts to be replaced by a sliding
scale based on CO2 emissions
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Minimum and maximum benefit charges of 15% and 35%
respectively to remain
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Starting level of CO2 emissions attracting
the minimum 15% charge to be 165g/km (reducing to 145g/km in 2004/05)
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An increase of 1% for each 5 g/km of CO2 emissions over
the minimum
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Diesels to attract a 3% supplement due to the emission
of other poisons
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