The Chancellor of the Exchequer, George Osborne, delivered the 2014 Budget on the 19th March – and on the whole, it’s good news for motorists.
Fuel Duty Freeze
It’s been confirmed in the Budget that fuel duty will remain frozen at 57.95p per litre until spring 2015. This means that the planned duty increase of 2p per litre in September has been scrapped. Although fuel remains at an extreme tax rate in the UK, the Chancellor claims that the fuel duty freezes are potentially saving consumers up to £10 per tank of fuel – compared to the previous government’s original plans for a 20% tax increase.
Road Tax
Although the road tax rate is set to stay the same, motorists will see a slight increase, in line with inflation. The increase is approximately 4%, translating to an extra cost of around £5 for most motorists, from the 1st April this year. Changes to the way you can pay for road tax are being introduced too – from October 2014 drivers will be able to pay monthly, bi-annually or annually. One change motorists aren’t happy about, however, is that remaining road tax will no longer be transferrable when it comes to selling your car.
Free road tax still applies to super economical cars emitting 100g/km or less of CO2. This is good news for owners of new cars, many of which now fall below this emission rate.
Paper tax discs will also be scrapped later this year in favour of a paperless electronic system. Displayed on our windscreens since 1921, the paper tax disc will come to an end in October 2014. The new system will use an electronic database to read license plates – making it easier to identify drivers who have failed to pay road tax.
Pot Holes
The new Budget will make £200 million available to local authorities. Councils will need to bid for their share of the fund to repair potholes and complete essential road maintenance in their area.
The pothole problem in the UK has escalated over recent years, with road maintenance being put on the back burner. Statistics show that, on average, there is now one road defect in every 110 metres of road in the UK. This repair fund will be welcome news to motorists who have incurred costly vehicle damage due to driving on potholed roads.
Classic Car Exemption
From 1st April this year, cars more than 40 years old will be granted exemption from road tax. This is good news for classic car owners – and is sure to increase their resale value. The 40 year exemption will be granted on a rolling basis, meaning that cars manufactured before the 1st January 1974 will be exempt this year.
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