Plug-In Vehicle Strategy Questioned

(Friday 21 September 2012)

The eleven-member cross-party Transport Select Committee has issued a report questioning the UK Government's policy on plug-in vehicles (including all-electric cars or plug-in hybrids whose battery packs can be recharged, among other ways, by using mains electricity).

The Committee, chaired by Labour MP Louise Ellman, notes that demand for these vehicles remains low despite a grant which offers 25% of their cost up to a maximum of £5000, criticises vagueness in the matter public chargepoints (of which the Government apparently has no register) and calls for the effective use of public money to fund policies aimed at reducing CO2 emissions from transport.

Another recommendation reads as follows: "The Government must avoid creating instability in the plug-in vehicle market through a lack of consistency between departments in their approaches to financial incentives for these vehicles and adopt a more co-ordinated approach to such incentives across Whitehall."

Interesting that that should come up, because in the Budget of March 2012 it was announced that exemption of vehicles emitting no, or very little, CO2 (all of them plug-ins or one sort or another) from company car tax will end in April 2015. Their tax rate will then rise from zero to 13%, and a year later to 15%.

Also in April 2015, the 3% company car tax supplement will be abolished. The net result will be a loss of tax income (assuming, as seems reasonable, that there will still be vastly more diesels than plug-ins two and a half years from now) but this doesn't alter the fact that the tax incentive will swing from vehicles emitting small amounts of CO2 to ones emitting rather more, apparently in contradiction of the Government's stated support for plug-in vehicles.