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13/03/20

Plug-in Car Grant Extension and zero emission VED Changes announced in 2020 Budget


The recently revealed 2020 budget is set to continue the government’s commitment to electric cars and reducing nitrous oxide emissions in towns and cities across the country. Alongside their zero emission plans, the government have also promised to invest vast amounts in improving roads and to freeze fuel duty for another year. 

As you almost certainly know, the Government are currently doing as much as possible to ensure that they reach their target of net zero carbon emissions by 2050; getting people into zero emission vehicles is a key part of that plan. As such, the 2020 budget promised a ‘comprehensive package of tax and spending reforms’ to help people get into EVs.

Jaguar IPACE

The first part of that package is an extension to the plug-in car grant (PiCG), so that it’ll now run until 2022/23. In order to make this happen, £403m has been set aside for cars and a further £129m to extend the plug-in van, taxi and motorcycle grants for the same period.

Unfortunately the extension has meant that the plug-in car grant has dropped to £3,000 (a reduction of £500) and now excludes cars over £50,000. For many, the reduction in PiCG hasn’t come as much of a surprise due to the recent increase in people purchasing electric cars.

The exclusion of cars over £50,000 has been somewhat negated by the removal of zero emission cars from the Vehicle Excise Duty (VED) ‘expensive car supplement’ which causes additional tax for cars priced above £40,000.

Alongside the PiCG and VED changes, the Government will be investing £500million to support the roll-out of rapid charging hubs and a further £1billion in green transport solutions. The budget also revealed an investment of £22billion per year in public R&D by 2024/25; that investment will be specifically used for electric vehicles, nuclear fusion, space and other life sciences.

Volvo Take Charge Scheme

Outside of electric vehicles and emissions, the budget included frozen fuel duty for the 10th year running. In figures, that means that current fuel duty rates for petrol, diesel, biodiesel and bioethanol remain at 57.95 pence per litre. Compared to 2010, the Government believes that the continued freeze will save most people around £1,200.

There will also be an incredible investment in the country’s roads, with the Government promising over £27billion between 2020 and 2025 – apparently enough to fill 50 million potholes and an ‘unprecedented investment’ in urban transport. Autocar report that the huge investment will see the creation of 20 connections to ports and airports, over 100 junctions and over 4,000 miles of road.

With so much money being put into zero emission vehicles and the infrastructure surrounding them, the next few years definitely promise to be incredible interesting and transformative. Look forward to a whole range of innovations and improvements as the year unfolds.

What do you think of the Government’s 2020 budget? Let us know your thoughts on Facebook, Twitter or Linkedin.

Do electric cars have a long enough range? Will I run out of charge quickly?

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