The government has been warned that extra transport taxes risk outweighing moves to encourage small businesses to use greener, fuel-efficient company cars.
The warning came from the Forum of Private Business (FPB) which said that additional transport taxes threaten to overshadow green incentives announced in the Budget.
The capital allowance for business owners who purchase new cars with low CO2 emissions, enabling them to write off 100 per cent of the purchase price of the vehicle, is being extended to five years.
However, the FPB pointed out that fuel duty went up by 2p in October 2007, and that the next increase, also of 2p, has only been postponed from April until October this year.
The Chancellor, Alistair Darling, revealed in the Budget that he would be inviting tenders for new road pricing technologies. Added to that, the FPB said, is continued government funding for local ‘congestion’ charges, which will affect many businesses that rely on freight transport for supplies and deliveries.
Phil Orford, the FPB’s chief executive, said: “The possibility of road pricing, combined with an increase in fuel duty, has left smaller businesses genuinely worried that they will struggle to control costs.”
Mr Orford added: “Many of our members are concerned that delivery and supply costs will rise sharply. Given the evidence that other input costs are also on the rise, many will have no option but to increase their prices in order to remain profitable.”
Date:28 March 2008
|
