Budget 2021

[DaveBeddis]

Moderator comment - post budget discussion starts with Budget 2021 (formerly BIK is Back)

Whats everyones thoughts on the Budget next month in regards to EV's. Read somewhere recently about reducing VAT. Would it be worth waiting to take delivery until after the 3rd March?

 

[Leebr]

Whats everyones thoughts on the Budget next month in regards to EV's. Read somewhere recently about reducing VAT. Would it be worth waiting to take delivery until after the 3rd March?

That’s a very good point. What’s a few extra days. It’s surely not going to become more expensive, well for EV’s anyway

 

[MrBadger]

Personally I do not see the point of dropping VAT unless it directly benefits UK businesses. Otherwise they will need as much income as possible to help pay for these extraordinary times.

 

[john19951]

It's more likely that the £3000 plug-in grant for EVs under £50 000 is dropped or reduced.

Wouldn't be surprised if they reduce the limit to £40 000 - thus excluding the cheapest Tesla.

 

[m3gt2]

It's more likely that the £3000 plug-in grant for EVs under £50 000 is dropped or reduced.

Wouldn't be surprised if they reduce the limit to £40 000 - thus excluding the cheapest Tesla.

I think if they did that you could guarantee Tesla would reduce the price!

 

[btc1k]

It's more likely that the £3000 plug-in grant for EVs under £50 000 is dropped or reduced.

Wouldn't be surprised if they reduce the limit to £40 000 - thus excluding the cheapest Tesla.

Unlikely. Currently planned to run to 22/23 at a cost of £400mn - small beans in the scheme of things.

 

[cyrill666]

On this news page from March 2020, they do state "government will provide £403 million for the plug-in car grant (PICG), extending it to 2022-23", which sounds promising. However, further down the page they also say "...the government will continue to keep the rate of the grant under review."

Personally, I'm hoping to order for May/June delivery so fingers crossed it remains the same (or changes for the better).

 

[MrBadger]

For reference, last years posts about the PICG and VED changes - iirc the PICG thread mentions how cars need to be recorded in the portal to avoid any change so well worth the long read.

Plug-in car Grant now £3000 (was £3500) for cars under £50k
Luxury Car Tax RIP - Budget 2020

 

[GRiLLA]

I'm not sure we will see further savings for EVs, more like penalties for ICE. Ramping up the VED based on emissions to a point where people actually care about their monstrosities pollution. Double them every year I say from the safety of my Tesla and Leaf

 

[btc1k]

Would love to see a VAT cut on EV's! - Wishful thinking though I think

 

[Adopado]

I'm not sure we will see further savings for EVs, more like penalties for ICE.

That seems a reasonable approach to me. There needs to be pressure from both directions i.e. not just changes that benefit EV ownership but changes that make ICE owning less attractive (a bit more expensive). Having said that we also have to accept that EV ownership is not going to be feasible for everyone immediately so it can't be anything too draconian. New EVs are expensive and the second hand market is small ... and also expensive. For those on low incomes and without any possibility of home charging it's not going to be an easy switch so they don't need even more financial pressure piled onto them.

 

[GRiLLA]

That seems a reasonable approach to me. There needs to be pressure from both directions i.e. not just changes that benefit EV ownership but changes that make ICE owning less attractive (a bit more expensive). Having said that we also have to accept that EV ownership is not going to be feasible for everyone immediately so it can't be anything too draconian. New EVs are expensive and the second hand market is small ... and also expensive. For those on low incomes and without any possibility of home charging it's not going to be an easy switch so they don't need even more financial pressure piled onto them.

VED works quite well for this, for example you could charge a punative rate for the first 3 years, then reduce it to avoid making second hand cars more expensive. Other forms of taxation don't have existing options to avoid specific engine sizes or vehicle ages.

 

[seadog]

As mentioned they can't be too drastic either way as the charging infrastructure is simply not up to it yet in some parts of the country. The government can't afford to lose too much income from ICE sources either with the pandemic to pay for.

 

[Glan gluaisne]

I'm not sure we will see further savings for EVs, more like penalties for ICE. Ramping up the VED based on emissions to a point where people actually care about their monstrosities pollution. Double them every year I say from the safety of my Tesla and Leaf

I agree, the government is short on cash, so cannot afford to increase any subsidies, may well actually reduce them, I think. Increasing VED, or imposing an additional purchase tax on conventional cars, seems more likely. With the big price differential between ICE cars and equivalent EVs there would seem to be scope to push up the price of new ICE cars a bit, so raising more revenue.

 

[Kenners]

More likely to hike fuel duty andreintroduce escalator. It’s just not that expensive anymore, paying same price as ten years ago and cars more efficient. That is the tax efficient way to get people into EVs!

 

[john19951]

The plug-in car grant should be there to encourage manufacturers to develop new EV cars at a price level that most people will be able to pay. I can't see any justification for taxpayers subsidising the £3 000 plug-in car grant for cars costing £40 000.

I have not seen discussion here that M3 Performance buyers are put off by not getting the £3 000 plug-in car grant. I conclude from that that Tesla buyers are generally not price sensitive.

 

[Blokie]

The plug-in car grant should be there to encourage manufacturers to develop new EV cars at a price level that most people will be able to pay. I can't see any justification for taxpayers subsidising the £3 000 plug-in car grant for cars costing £40 000.

I have not seen discussion here that M3 Performance buyers are put off by not getting the £3 000 plug-in car grant. I conclude from that that Tesla buyers are generally not price sensitive.

I went for my 2021 LR as opposed to the P for exactly this reason - I just couldn't justify that additional £3000 difference between the models for what you get.

 

[seadog]

Would agree with above, if I were buying now I would go LR rather than P as the price difference is too much to justify now. It would be interesting to see if the P sales differed after the removal of the grant.

 

[Durzel]

It's tough to make the argument that the grant should work for cars even costing £40k, to be honest. I'm grateful for getting it, but Teslas are not "EVs for the masses". If the grant threshold reducing to £40k means getting 3 more people into "everyman EVs", then I'm all for it.

The existing £50k threshold is, in my opinion, already generous.

 

[m3p_uk]

Wasn't there a review of road tax planned? So you'd pay for more usage if you drive more miles?