London, 22 March 2000.
For immediate release.

Contact the ABD

Press Release

Mixed Response To Budget From British Drivers
Brown Listens To ABD On 1100cc Road Tax Cutoff
But Hammers Commuters With Petrol Tax if they Drive and Stamp Duty if they Move
Gordon Brown has responded to the heavy criticism of the 1100cc cutoff for the GBP55 reduction in "small car" Road Tax by increasing it to 1200cc from March 2001.

It was the ABD who first pointed out that the original 1100 cc cutoff point was chosen to look good but to exclude the maximum number of cars - there were twice as many newly registered cars which just missed out as there were qualifying vehicles.

"Many people thought they would get the reduction because they were driving small cars described as 1100cc by their manufacturers, but then found they were excluded by as little as 9cc," says the ABDís Nigel Humphries. "People rightly thought this was a cynical exercise by the treasury to get maximum PR for minimum revenue loss, and Gordon Brown has done well to correct this by raising the threshold to 1200cc and so including many small cars which are suitable for families."

However, Gordon has not done so well with fuel tax. In raising petrol duty by the rate of inflation he has piled another 2p per litre on top of the swingeing increases brought about by world oil price rises and many years of the hated fuel duty escalator. Why couldnít he lay off us, just this once?

"Petrol prices have already shot up this year, so Brown's 'inflation rise' is really piled on top of inflation," says Humphries. "This is a tax too far."

But the really crazy thing about Brown's budget is something that shows the absence of joined up thinking across departments - stamp duty on houses. This has gone up to 3% on properties over GBP250,000 and 4% on those over GBP500,000 - any house big enough for a family in the congested South East of England will incur at least 3% stamp duty.

"This means that anyone taking Mr Prescott's advice and moving their family closer to their place of work to avoid commuting by car will have to pay Mr Brown at least GBP7500," complains Humphries. "Either that, or Prescott will have them for road tolls and workplace parking charges. Pay your money and take your choice - most of us will commute when those sort of sums are involved."

It is a shame that transport is still so low on the agenda that such factors are not considered by the Chancellor or the Treasury when setting such taxes.


Notes for Editors