UK Considering Differentiating Plug-In Hybrid Tax Incentives
UK is considering differentiating tax incentives for plug-in hybrids for companies, to better promote models with more all-electric range than others.
From March 1st, the UK government already modified its rules for its Plug-In Car Grant – lowering the maximum amount to £4,500 for BEVs and £2,500 for PHEV, as well as setting price cap for PHEVs:
Category 1 – cars with zero emission range of 70 miles or more and CO2 emission below 50 g/km. (£4,500, no price cap)
Category 2 – cars with zero emission range 10-69 miles and CO2 emission below 50 g/km (£2,500, £60,000 price cap)
Category 3 – cars with zero emission range 20 or more miles and CO2 emission 50-75 g/km (£2,500, £60,000 price cap)
A strong benefit that could be tweaked by 2020-2021 (and announced this Fall) is the Benefit in Kind program. HM Treasury is currently doing reconnaissance to bind the incentives with all-electric range. That would limit the support for cars that, on average, mostly uses its engine.
“The proposal is a system which defines ULEVs by sub-50g/km CO2 emissions, then divides them into bands based on their electric range, incentivising vehicles which can be driven longer distances without using a petrol or diesel engine.”