Backdating VED 'makes perfect sense'
Find out how we can support your business.
MPs have decreed that retrospectively applying higher Vehicle Excise Duty (VED) rates is totally justifiable.
In a move that is certain to worry fleet managers who purchased their vehicles after 2001, the ruling by the cross-party committee could see drivers' VED rates spike to as much as £455 a year.
The revisions form part of a proposed overhaul of vehicle-related green taxes, with the number of VED bands being raised to 13 and higher charges being levied against the worst-polluting cars.
While the industry has largely been receptive for the need to deter new purchases of 'gas guzzling' vehicles, the government's plans to backdate higher charges has riled many.
Despite this, the Environmental Audit Committee report concluded that there is "nothing intrinsically unfair or unusual about setting new VED rates for cars that have already been purchased".
It concluded that the tough measure is justifiable because it will influence purchasing decisions in the used car market.
The report stated: "It makes perfect sense to re-band existing cars based on their respective carbon emissions as this can be a way of influencing buyers of second-hand cars to choose models with lower emissions."
