Report on the Budget Statement 2014


As usual we have a prompt report on the Budget Statement within an hour or so of the Chancellor sitting down in the House of Commons.

HM Treasury webpage with links to additional information on the Budget Statement. More

Budget 2014 documents
Extract from the HM Treasury support document and a link to other documents. Extracts & More

HMRC review of the rolling VED exemption extension
See the HMRC note. More

Preview of the Budget Statement 2014
See our preview. More

Autumn Statement 2013
See our report. More

Budget 2013 - see our report in March
Our prompt report of the key points for classic car enthusiasts.
HM Treasury & HMRC

Budget statement 2012- see our report

See our report. More & More



Posted: 140319 @ 1415

Budget Statement on Wednesday 19th March
The Budget Statement 2014 made in the House of Commons by the Chancellor of the Exchequer, George Osborne, on Wednesday 19th March provided an
update on the Government’s plans for the economy based on the latest forecasts from the Office for Budget Responsibility. These forecasts are published alongside the Budget Statement. Full details of those announcements are available on the HM Treasury website following the Chancellor's statement to Parliament but as usual we have a prompt report on the measures announced which will be of interest for the classic motoring enthusiast.

What did we see in the Budget Statement for classic car motoring?


VED exemption now a rolling concession
This welcome news was tucked away on page 76 of the support document released by HM Treasury shortly after the Chancellor sat down. The brief announcement is "the Government will introduce a rolling 40 year VED exemption for classic vehicles from 1st April 2014 (Para 2.153, page 76)

Adding the rolling feature follows the announcement in the support document issued by HM Treasury shortly after the Budget Statement in March 2013 that the Government will extend the cut off date from which classic vehicles are exempt from VED by one year. From 1st April 2014 a vehicle manufactured before 1st January 1974 will be exempt from paying VED. (Para 2.148, page 84)
See additional information on VED exemption. More


Fuel duty

The Chancellor confirmed the 2p fuel duty increase due in September 2014 is to be frozen. This follows the announcement in the Autumn Statement 2013 that as well as scrapping that increase, George Osborne confirmed that no further rise would take place until at least May 2015 to ease the cost of motoring for the general public and UK business. To date, fuel duty has now been frozen for over four years, the longest duty freeze for over 20 years. Since their election in 2011, the Coalition has cancelled or delayed all the fuel duty rises that had been announced by the previous Labour administration. That means compared with the previous Government's plans, petrol is around 20p per litre less. That is £11 less every time you fill up or, for a typical classic car use of say 5,000 miles a year, a saving of around £170. (Para 2.152, page 76)

However by scrapping all intended rises in duty over the last four years, the Treasury has sacrificed £22 billion of potential tax revenue; a loss which will have to be balanced by cuts elsewhere in the economy.
VED rates and bands
The VED rates and bands for cars, motorcycles and the main rates for vans will increase by Retail Prices Index RPI from 1st April 2014 but no structural changes were announced. That is in line with the Autumn Statement in 2013 when the Chancellor added the Government has no plans to make significant reforms to the structure of VED for cars and vans in this Parliament. (Para: 2.152, page 76).


Abolishing the paper tax disc and payment of road tax by Direct Debit
These measures were confirmed - VED administrative simplification - and had been previously announced in the Autumn Statement and are due to be introduced from 1st October 2014. (Para 2.154, page 76) More

Pothole repair fund
Classic car enthusiasts have reported some heavy suspension crashes with the ever increasing pothole problem, so they will welcome the good news in today's Budget Statement that a £200m pothole repair fund is being established. This will mean councils will be able to bid for money to repair roads ravaged by the winter floods. The current estimate for repairs is £400 million, on top of the £10.5 billion repair backlog that already exists. (Para 2.28, page 63)

VAT - no change
No increase in the VAT rate was announced but equally no reduction from the current 20% either.

Insurance tax
No change which could have had an impact on classic car motor policies. The standard rate of 6% (Jan 2011 - April 2012) remained at 6% for 2012-13 and continues for 2014-15. See page B18 of the HMRC document.
Tax rates & allowances Annex B
V8 Register - MG Car Club - the leading group for MG V8 enthusiasts at www.v8register.net