Report on the Budget Statement 2015
Budget Statement on Wednesday 18th March
The Budget Statement 2015 made in the House of Commons by the Chancellor of the Exchequer, George Osborne, on Wednesday 18th 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 to the classic motoring enthusiast.

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. 		Headlines for for classic car motoring

Fuel Duty - the RPI inflation Fuel Duty increase due to apply from September has been cancelled.

Vehicle Excise Duty rates and bands - from 1st April 2015 Vehicle Excise Duty (VED) rates for cars, vans, motorcycles and motorcycle trade licences will increase by RPI. (Finance Bill
2015)

Vehicle Excise Duty classic vehicle exemption - as announced at Budget 2014, from 1st April 2016 a vehicle manufactured before 1st January 1976 will be exempt from paying VED.

Alcohol Duty rates - from 23rd March 2015, the duty rates on general beer, spirits and lower strength cider will be reduced by 2%.
Chancellor George Osborne delivered his last Budget statement of the current UK Parliament less than two months before the date of the General Election on 7th May. His statement provided an update on the economy, including tax announcements,came just weeks before Parliament breaks up at the start of campaigning ahead of the poll.

Why does the Chancellor hold the "Red Box" up for photos as he leaves for the House of Commons on Budget day? See below

Full details of the Budget announcements are available on the HM Treasury website released following the Chancellor's statement to Parliament.

Budget 2015 document from HM Treasury. More

Preview of the Budget Statement 2015
See our preview. More
What did we see in the Budget Statement 2015 for classic car motoring?

Fuel Duty
The government will cancel the RPI inflation Fuel Duty increase of 0.54 pence per litre scheduled for 1st September 2015. The effect is the fuel duty increase planned by the previous Labour government and due to apply from September 2015 has been cancelled. The aggregate saving for drivers is now around £10 per tank of fuel.

Vehicle Excise Duty rates and bands
From 1st April 2015 Vehicle Excise Duty (VED) rates for cars, vans, motorcycles and motorcycle trade licences will increase by RPI. (Finance Bill 2015)

Vehicle Excise Duty classic vehicle exemption
As announced at Budget 2014, from 1st April 2016 a vehicle manufactured before 1st January 1976 will be exempt from paying VED. (Finance Bill 2015)



Alcohol Duty rates
From 23rd March 2015, the duty rates on general beer, spirits and lower strength cider will be reduced by 2%. The duty rate on low strength beer will be reduced by 6% and the total duty rate on high strength beer will be reduced by 0.75%. The duty rate on high strength still cider will be reduced by 1.3% and the duty rates on wine below 22% abv and
high strength sparkling cider will be frozen. (Finance Bill 2015) (9,10)

Over the last four years we have seen fuel duty frozen and VED exemption reintroduced for classic car owners, both measures that have been a real benefit for classic car enthusiasts.

See our VED exemption guide and flowchart. More
Will the VED roll on as promised? More
Posted: 150318 @ 1405What did we see in previous Budgets and Autumn Statements?

See our earlier reports and links to HM Treasury and HMRC webpages. More

Why does the Chancellor hold the "Red Box" up for photos as he leaves for the House of Commons on Budget day?
Seeing the red case on the news item reminds me of an article in a newspaper today which recounts how in 1868 George Ward Hunt, the chancellor in Disraeli's short lived government, went to the House of Commons but left his budget speech behind at home. Now chancellors lift the red box as they leave their "house" to show they haven't forgotten their speech.








Autumn Statement 2014
The headlines for classic car enthusiasts in the Autumn Statement or "Mini Budget" on Wednesday 3rd December 2014 were:
> Motor fuel duty frozen in 2015 - George Osborne said "despite falling fuel prices let me make this clear: we've cut fuel duty and we will keep it frozen."
> Road building to deal with a number of bottlenecks on the A1 in the north and the A303 - the Government has committed £15 billion to improve the national road network. Green campaigners have railed against Chancellor George Osborne's Autumn Statement, slamming its "1980's-style road building programme and tax breaks for fossil fuel giants". Are there tax breaks for open-toed sandals!
> Motorway fuel price comparison signs – the government will install electronic signs showing fuel price comparisons on the M5 between Bristol and Exeter during 2015. (Para 2.240, p 90 HM Treasury document.).

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

More from earlier Budget Statements

Vehicle Excise Duty (VED)
In the Budgets 2013 and 2014 classic car enthusiasts saw very welcome news with VED exemption concessions, so now the concern for enthusiasts with cars built after 1974, which do not yet benefit from the exemption, is the VED rates and bands that apply to their classic car and daily cars.

VED rates and bands
The Budget Statement in March 2013 announced that from 1st April 2013 VED rates would increase in line with RPI, apart from VED rates for heavy goods vehicles (HGVs) which will be frozen in 2013-14. The Statement added the Government has no plans to make significant reforms to the structure of VED for cars and vans in this Parliament. So from 1st April 2014, VED rates are likely to continue to increase in line with the Retail Prices Index (RPI). According the previous announcements, the Government has shelved its plans to reform to the structure of VED bands for cars and vans in this Parliament. So the bands will remain. (Para: 2.146, page 83). HM Treasury

VED exemption now a rolling concession
In the Budget 2014 in March, tucked away on page 76 of the support document released by HM Treasury shortly after the Chancellor sat down, was the welcome brief announcement "the Government will introduce a rolling 40 year VED exemption for classic vehicles from 1st April 2014". (Para 2.153, page 76). That rolling VED exemption followed the earlier announcement in the support document issued by HM Treasury shortly after the Budget Statement made in March 2013 that the Government would extend the cut off date from which classic vehicles are exempt from VED by one year. So making it a rolling feature was very good news. See our additional information on VED exemption.
VED exemption guide & flowchart & More
Abolishing the paper tax disc and payment of road tax by Direct Debit
These measures were confirmed as part of a simplification of VED administration and were introduced by DVLA in October 2014. See our NEWS reports. More & More

Fuel duty
In March 2014 the Chancellor confirmed the 2p fuel duty increase due in September 2014 would be frozen. This followed 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.

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.

With falling motor fuel prices at filling stations, the tax take as a percentage of the price per litre has risen. There is pressure to reduce that percentage with a consequent reduction in the combined taxes and duty. With lower pump prices pleasing the motorist the likelihood of a reduction in either tax or duty on motor fuel seems slim.

Falling fuel prices
With the fall in crude oil prices motor fuel prices have been falling driven in many cases by supermarket filling stations - supermarkets are experiencing the most intense market battle for many years and attracting customers has become an essential need. Using low motor fuel prices is a tactic they use which is a benefit to the motorist as it puts pressure on leading petrol retailers to consider their fuel prices too and often reduce them.

Pothole repair fund
Classic car enthusiasts have reported some heavy suspension crashes with the ever increasing pothole problem, so they welcomed the good news in the last Budget Statement that a £200m pothole repair fund was 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 mentioned in the Budget 2014 was£400 million, on top of the £10.5 billion repair backlog that already exists. (Para 2.28, page 63)


V8 Register - MG Car Club - the leading group for MG V8 enthusiasts at www.v8register.net