London, 10 March 1999.
For immediate release.

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Brown's Budget Hits Drivers as Predicted
And Packs Nasty Surprises for Everyone in the Small Print
Gordon Brown's Budget has been presented as a "budget for the family" and a "fair" budget, but closer examination by the ABD reveals it as neither.

Even Mr Brown's one concession to the motorist - the £55 cut in the tax disc for "small" cars - contains a cruel irony. The Mini, for many the definitive British small car, is not eligible for the reduction because it's engine is too large. If the Mini is not a small car, what is, Mr Brown?

ABD Chairman Brian Gregory comments: "Gordon Brown has been very clever at presenting a rip off as a giveaway. But dig deeper and the facts become clear."

A Budget For The Low Paid, Or A Tax Bombshell?

The tax cuts for the lower paid, praised by the naive, are worth little when another huge step has been taken towards pricing mobility out of the reach of all but the wealthy.

This budget will force drivers to hand over a staggering total of £1,400 in tax.

"These very real tax increases mean serious restrictions on mobility and freedom for some of the most vulnerable in society", says Mark McArthur-Christie, the ABD's Roads and Traffic Spokesman."These taxes hit the people who struggle hard to afford to run their cars - the poor, pensioners, people in rural areas and families. But we all suffer. These tax hikes push up transport and delivery costs, and make our businesses less competitive".

McArthur-Christie continues: "Drivers are already paying far too much tax - but this is just the start of the government's tax plans for drivers. Soon we'll be charged for driving in towns, in the country, on motorways and even for parking at the office. Car taxes should be ring-fenced and spent on improving the UK's transport infrastructure - not used as a stick to drive motorists out of their cars and onto an inadequate public transport system. The government now treats drivers' wallets as public property and cars as piggy banks on wheels. Gordon Brown's new taxes are not pro-environment or pro-public transport, they are simply anti-car."

A Carbon Tax - Whether You Emit It Or Not

But the unfairness of the budget doesn't end there. From 2000 cars will be taxed according to their carbon emissions. But this isn't fair. Someone who does 1500 miles a year in an elderly Range Rover will emit less carbon than another driver doing 30,000 miles a year in a Ford Fiesta. But they will be taxed much more heavily under these Budget proposals.

A Budget For The Family?

It gets even worse when we examine Brown's claim to support the family. He is taking away the married man's allowance and replacing it with a children's tax credit, which sounds reasonable for families - until you realise that as soon as the combined income rises over £32,335 then this tax credit begins to erode. What has this got to do with motoring? Simply that a £20,000 company car, even if it is a totally necessary business tool, will now incur a £3000 taxable benefit, rising to at least £5000 when the mileage based reduction is finally abolished. This means a working family only have to earn £28,335 before the child tax credit begins to erode.

A Quadruple Whammy For The Hardworking Family Man

So the hardworking family man (or woman), supporting a young family and a mortgage, in a typical commercial job involving extensive business travel, working an 80 hour week for a salary in the high £20k's - not untypical of millions of modern workers - will lose his Miras and his married man's allowance whilst suffering a huge increase in his National Insurance contributions. On top of this, his company car, an essential business tool which he would not require nor could afford to purchase for his own use, will incur a huge tax increase which pushes his family into the higher rate bracket and removes his child tax credit on money he isn't earning.

"People in this position, who the Government should be supporting and encouraging as tomorrow's decision makers, will be sickened when they realise that they have been hit by this quadruple whammy" said Mark McArthur Christie. "Instead, they might as well pack it in and be a dustman - unless the government finds a way of taxing them for riding on the dustcart!"

Stamp Duty - Another Tax On Mobility

The Government's decision to further raise stamp duty on house purchases is yet another tax on mobility. On a £300,000 house, that means £7500 in stamp duty. Not everyone buying houses in this bracket is wealthy - many have inherited properties from their parents. Stamp duty at this level is a huge disincentive to move house, maybe closer to ones place of work.

"This mobility tax just shows how the Government really don't care about reducing commuting distances and congestion," says Mark McArthur Christie. "They just want an excuse to raise revenue."

 

Notes for Editors