The Society of Motor Manufacturers and Traders (SMMT) has called on the Chancellor to reconsider plans that would introduce major car tax changes next year.
From April 2025, double cab pick-up trucks will be taxed as cars for Benefit-in-Kind purposes and capital allowances.
The automotive trade body warns that the proposed tax changes will place additional financial burdens on businesses that depend on these vehicles.
Self-employed workers, farmers, construction firms and utility companies could soon face significant cost increases under the new rules.
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Drivers have called for the Government to U-turn and axe proposed car tax changes
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This call for reconsideration comes after the previous Government’s brief attempt to implement similar measures, which resulted in a rapid U-turn.
These measures would have seen anyone purchasing a double cab pick-up truck after July 1, 2024, hit with a near-fivefold increase in their personal tax bills.
This could have had an enormous impact on motorists with popular vehicles with a payload of more than 1,000kg, including the Ford Ranger Wildtrak.
The proposals were quickly axed following mass backlash from motorists, with HM Revenue and Customs saying it has “listened carefully” to the fury.
The SMMT is pushing for the Government to maintain HMRC’s February decision, arguing that a change in tax treatment could harm growth prospects across affected sectors, Fleet News reported.
Recent data already shows concerning trends, with pick-up registrations dropping by 20.4 per cent to 3,012 units in November.
The decline in pick-up registrations comes amid broader concerns about the impact of future tax changes on the commercial vehicle sector.
Speaking in February, Nigel Huddleston, former Financial Secretary to the Treasury, said the U-turn was necessary to restrict the impact of additional costs.
The Conservative MP for Droitwich and Evesham said: “We will change the law at the next available Finance Bill in order to avoid tax outcomes that could inadvertently harm farmers, van drivers and the UK’s economy.”
Data from the SMMT reveals that pick-up demand has been weakening throughout the year, with October’s Budget announcement potentially putting the segment at further risk.
This downward trend stands in stark contrast to the overall light commercial vehicle market’s performance.
The trade body’s concerns reflect wider industry anxieties about additional cost pressures during a challenging economic period.
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Despite concerns in the pick-up segment, the broader light commercial vehicle market showed strong performance, marking its fourth consecutive month of growth.
SMMT chief executive Mike Hawes said: “Britain’s appetite for zero emission vans continues to lag behind government ambition, however, and market share this year is heading in the wrong direction.”
