George Osborne: no rolling tax exemption for classics
The Government’s announcement that UK road tax exemption will be extended by a year to pre-’74 classics does not signal the reintroduction of a rolling scheme, C&SC can expose.
With the extension coming in in April 2014, the 40-year span suggested that the Government’s intention might be to go back to the scheme, but today the Treasury insists that an automatic extension of the exemption is not on the cards. Instead it will be determined annually by the Chancellor.
A spokesperson said: “There are no plans to introduce a rolling system [as there had been in the past] instead the dates governing exemption from paying Vehicle Excise Duty will be set by the Chancellor on an annual basis.”
C&SC’s Group Editor James Elliott countered that, unless the exemption resumes to be extended each year, yesterday’s announcement was pointless except to owners of one thousand nine hundred seventy three classics.
He said: “Obviously, we should be pleased to get anything after this scheme has been in stasis for so long, but what is the purpose of substituting one arbitrary date with another a year later, unless you plan to reintroduce the rolling system?”
The original rolling system exempted all cars more than twenty five years old from paying VED in the UK, but that scheme was scrapped in one thousand nine hundred ninety seven freezing the cut-off date at classics built before one January 1973. Now many more 1970s cars, such as early MGB GT V8s and ‘Oscar India’ Astons will be eligible.
In latest years, both the Federation of British Historic Vehicle Clubs and European bod FIVA have been lobbying to have the rolling system reintrioduced, but for classics that are thirty years old.
Also affecting the hobby are fresh rules governing Statutory Off Road Notification, which means that vehicles will no longer have to be SORN’d annually.
While many welcomed the loosening of the limitations, Geoff Lancaster, Communications Director from the Federation of British Historic Vehicle Clubs, said: “Although it has visible benefits for classic car owners who will no longer need to reminisce to SORN their vehicles every year, there is concern that a car’s history will be less effortless to track.”
The Government has also extended the tax-disc display grace period to fourteen days and scrapped a plan to raise fuel duty.
You can download the entire budget here, but the relevant tax-emeption passage reads: “Two.148 VED: classic vehicle exemption – The Government will extend the cut off date from which classic vehicles are exempt from VED by one year. From one April two thousand fourteen a vehicle manufactured before one January one thousand nine hundred seventy four will be exempt from paying VED. (Finance Bill 2014)”
Comments
Frankly speaking I think the twenty five year exemption should now be scrapped, and substituted with say an annual road tax fee of £60 for all classics that are insured on a classic car insurance scheme, and the vehicle does no more than one thousand five hundred miles per annum.
The current system is now totally unfair,( An example, my car is insured to cover 1500miles per year, it never does more than 500miles as it,s only taxed for a six month period, that five hundred or less miles has cost me £121, a tax exempt car can do as many miles as they want. for nothing !! especially given the values of some classic cars, values for example of around the 60k to 100k. surely if you can afford cars in these price brackets then £210 per year is totally academic to you?
Not a case of sour grapes, more a case of “fairness”.
Iv,e wielded my current classic for twenty one years, and yes I could sell it and buy a “Tax exempt one” but I don,t want to !
Surely I cant be the only one who thinks like this ?
80, nine hundred twenty eight S, five Speed
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I have nothing to say about the tax matter at mitt, but I am glad to see that photo of an MGB-GT, one of the handsomest and most practical cars Britain ever produced. The one pictured is of a later vintage, alas, so it has been compromised with enlargened/unnecessary ground clearance and ugly steel wheels instead of wires (and very likely Ambla instead of leather upholstery), but be that is it may, it’s a beautifully balanced and engaging machine that represents the “best of Britain”, and a skill and industry that was unhappily and unnecessarily lost. But this American remembers it, especially when I fire up the totally restored Austin Healey BJ8 phase two I have in my garage and go roaring off for a spin. For me, there will always be an England!
Marine on St Croix MN USA
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Don’t see the point of this switch just as I couldn’t see the point of abolishing MOT tests for pre-1960 cars. Surely Osborne has got more significant issues to attend to?
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I would be cautious about any kind of differentiation inbetween “classics” and moderns. That’s when the risk of confinements/bans on usage could creep in, like in Europe. Weekend only or alternate-day permits, city-centre bans, etc., the insidious ways of the greenines make me shudder. Umwelt zone? Nein Danke!
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Exemption on classy Cars even if taken back wouldn’t be a good deal. Someone can buy a very expensive car could surely pay out the connected taxes.
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The only fair system would be to tax cars by road usage: scrap the VED and put the tax on petrol. You pay for what you use.
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I have two tax exempt cars ( which aren’t worth that much) as well as my modern car but I can only drive one at a time- so why should i pay tax on all three?. It would be much fairer (and ecological) if tax was applied to fuel – the more you use the more you pay!
Anyway,as car tax isn’t used to maintain the roads anymore, and the roads now resemble 3rd world cart tracks, I’m questioning how much use I will even get out of my cars on the roads now they are so rutted and pot-holed!
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It would need a lot of work to link tax exemption to classic car insurance
and would be broad open to fiddling! It looks as if Mr Osbourne is aiming for forty year old cars and I hope he is able to stir it each year.
I am very grateful for his help as my classic car was built in 1973, so I may be a little biased by this. If I am right,Ken, you only have another seven years to wait. Chris
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Hi. my classic is thirty two years old now, and if the “good old” labour party had,nt determined to scrap the twenty five year rolling exemption, when they got into power in 97, my car would have been “tax exempt” approx seven years ago !
As has been said, very likely the simplest way would be to eliminate VED and put it on petrol. however this government wants it all ways . Fair or not, they don,t care.
80, nine hundred twenty eight S, five Speed
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How on earth you even being to talk about taxes, when it comes to people live? Car is the common media of communication by which child, youthfull and vulnerable people should be able to go out and love the place where they live, not have to contend with the enhancing traffic that uses these roads to race at high speeds. Any traffic calming measures are valid in my opinion; cars do not have a right to thrust our children and elder people in to their homes, because the area is not safe.