The 2021 Autumn Budget Highlights

29th Oct 2021

Chancellor Rishi Sunak has revealed the government’s spending and taxation plans in his autumn Budget.

With a number of announcements made on the run up to the day, the statements made to the House of Commons was light on headline news for the fleet and leasing sectors. Freezes on VED and Fuel duty were mostly expected as was the confirmation that the Company Car Tax (CCT), already announced for 2022-23 will remain frozen until 2024-25.
Take a look at our short run down on the highlights on things most likely to affect fleet:

Fuel Duty:

Fuel duty is to remain frozen for the 12th year in a row at 57.95p per litre for both petrol and diesel. A 2.8p fuel duty rise had been anticipated, but with petrol prices at an all-time high and diesel just falling short of the record high seen in 2012, this announcement will no doubt be welcomed.

Vehicle Excise Duty

Vehicle Excise Duty (VED) for cars, vans and motorcycles will increase in line with inflation (RPI) from April 2022. This confirms what had previously been announced in the Chancellor’s Spring Budget. He also announced that the HGV levy freeze, previously suspended until the August 2022, will be extended until 2023 and vehicle excise duty (VED) for HGVs would be frozen for the next year to help the supply crisis.

Inflation, National Insurance and Company Car Tax

  • BIK tables were not mentioned but Company Car Tax (already announced) for 2022-23 will remain frozen until 2024-25.
  • National Insurance Contributions on pay over £9,568 will rise from 12% to 13.25% from April 2022. £24k earners will pay £180 extra per year with firms contributing as well.
  • On inflation, Sunak said that in September it was 3.1% and is likely to rise further – with the OBR expecting CPI to average 4% over next year.

HGV levy extended until 2023 to ease supply shortages

There is to be new funding to address the HGV driver shortage and to improve lorry parks. The HGV levy, already suspended until August, will be put on hold for a further year, with as mentioned, the VED for HGVs also frozen.
The Government has also pledged new money to improve lorry park facilities. It says it will invest £32.5 million in roadside facilities for HGV drivers.

The van benefit charge 

The van benefit charge will increase in line with the Consumer Price Index (CPI) from April 2022, which was expected.

Annual Investment Allowance (AIA)

The temporary £1 million Annual Investment Allowance (AIA) will be extended to 31 March 2023. This move will offer further support for businesses incurring capital expenditure and will help to encourage investment.

Funding for transport electrification

At the heart of the government’s recent Net Zero Strategy, it was announced that £620 million will be made available for zero emission vehicle grants and EV infrastructure.

Innovation investment

The Treasury has said it is spending £1.4 billion to “spur a wave of investment in the UK’s most innovative sectors”. This ‘Global Britain Investment Fund’ is designed to support investment in the UK’s life sciences, offshore wind and automotive manufacturing sectors.  The examples given include investments connected to EV production in regions such as the North East and the Midlands with £817 million to be channelled into the electrification of UK vehicles and their supply chains and support investment in zero emission vehicle manufacturing. 

This funding pot reinforces the government’s commitment to its net zero targets, alongside its continuing efforts to attract international companies to invest in Britain.

Public transport

A total of £2.6 billion will be spent between 2020-2025 on a new, long-term pipeline of over 50 local road upgrades in England, while more than £5 billion is being invested into local roads maintenance. In a bid to improve commutes and journey times outside of London, English regions, including Greater Manchester and the West Midlands, will receive £6.9 billion to fund train, tram, bus and cycle projects.

Only £1.5 billion is new, with £4.2 billion promised in 2019 and additional funding for buses announced by the prime minster in 2020.

Need advice?

If you want to talk to us about how these latest announcements may affect your fleet, get in touch with your PVM Account Manager or you can also contact us using the button below.