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Taxes, taxes and more taxes

So, we heard this week that from April hundreds of company car drivers could be facing even higher BIK taxes as a result of a reshuffle in the tax bands. What a surprise – yet another tax for fleet companies to add to the growing list of financial penalties they are expected to shoulder in the name of economic recovery.

As if it wasn’t enough to be facing another fuel tax hike, higher VAT and spiralling inflation…

According to a report by the Institute of Fiscal Studies, around 750,000 employees will be dragged into a higher rate tax band with an additional 850,000 following in the next three years. This means the point at which workers will pay the 40 per cent tax rate will reduce from £43,875 to £42,275.

This may seem like a small difference but combined with the increasing level at which employees start to pay income tax, many employees will find themselves paying double their usual BIK tax rate, as those currently paying 20 per cent will suddenly find themselves in the much scarier 40 per cent bracket.

We understand that times are tough but it seems the motorist is becoming an easy target for the Government’s spending cuts, taking far more than their fair share of the financial pressure.

If the Chancellor does not rethink the April fuel duty, there will be no surviving fleet companies left to pay any taxes at all.

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