Government Ban on Salary Sacrifice Cars Highly Unlikely, says Fleet Evolution

Fleet Evolution has spoken out about the rumoured government ban on salary sacrifice. A former pensions minister suggested that the new Conservative government could use the schemes to recoup lost tax revenue.

According to Steve Webb, Former Liberal Democrat MP, the government might be tempted to attack salary sacrifice. This is an effort to bolster national insurance contributions after they already ruled out increases to income tax and VAT.

The team at Fleet Evolution believe the government will shy away from banning the schemes. This is because they actually offer benefits for the Treasury.

“There are lots of rumours flying around about the government. Experts are suggesting that salary sacrifice schemes might be real targets for cuts in the first Budget of the new term. Here at Fleet Evolution, we are very confident that this won’t be the case. Salary sacrifice schemes are not taxed negative. They actually provide value and benefits for the Treasury. The money the government would gain through NIC would actually be offset by revenue loss in other areas. Areas such as the VAT due on the disposal of vehicles when they’re no longer of use.”

Andrew Leech, Director of Fleet Evolution

Many other experts have also agreed that a ban on salary sacrifice could well be unenforceable

This is as they usually take the form of private contracts between employers and employees. Both must agree to the changes to the terms of the employee’s contract. A rule banning the schemes would be incredibly difficult for the government to actually draft without infringing on personal rights.

Over the last few years, salary sacrifice schemes have been incredibly popular with many employees.  Fleet Evolution itself saw its strongest ever quarter earlier this year, with more take-up of the schemes than ever before.

These schemes also cover things like childcare, cycling schemes and other benefits. Furthermore, if the government were to clamp down on these schemes, businesses would need to rethink their benefits packages for employees. Due to this, the ban could result in turmoil for many of the country’s most successful businesses. This is something that will not endear the current government to the UK’s business leaders.


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