UK Government Extends Tax Breaks to Commercial EV Owners

The UK government announced that they would extend tax cuts to electric motor vehicles to fleet buyers and commercial users. The British motor industry met the announcement with open arms as these tax cuts had already been extended to private electric vehicle owners.

Alistair Darling states that electric vehicles will not be factored into the company car tax in his pre-Budget report. The tax break, which also includes electric vans, will be in effect for five years. Additionally, in order to boost incentives to buy electric vans, the government will allow for a full tax write off for company’s purchasing them against a corporate tax for the year.

Earlier in the year, the government extended tax breaks to private electric vehicle owners ranging from£2,000 to £5,000 beginning in 2011. Industry analysts and manufacturers, however, are saying that this new move will require hefty government subsidies in the first few years to diffuse higher costs.

The industry had been abuzz with rumors that the government would extend the tax to commercial buyers, however the news was warmly welcomed when made official on Wednesday. Mr. Darling’s pre-Budget report also details plans to spend an additional  £30m for the development of low-carbon vehicle competition in the market.

The government also this year set aside funding to improve infrastructure for recharging stations, and has also been engaged in talks with Nissan to bring about a European production plant of electric cars.Gordon Brown’s policies are in support of electric vehicles and saturating them into the mainstream market.