Graduated ‘road tax’ scheme for motorhomes scrapped

[Derek Uzzell]

Forum-members are probably aware that - after the motorhome Vehicle Excise Duty (VED) debacle where motorhomes would be ‘road taxed’ based on their CO2 emissions figure - it was decided that, from 1 April 2021, the VED rates for motorhomes would be linked to the Light Goods Vehicle VED class. This is explained here

 

https://www.gov.uk/government/publications/vehicle-excise-duty-rates-for-motorhomes-from-12-march-2020/vehicle-excise-duty-rates-for-motorhomes

 

On Page 31 of the January 2021 issue of MMM magazine is an article saying that the Treasury has confirmed that the scheme mentioned in the above link will not now be implemented.

 

The article says “New motorhomes will continue to be placed and taxed in the Private/Light Goods class”.

 

This VED class applies to vehicles with a maximum gross vehicle weight (GVW, MAM, MTPLM, etc.) not exceeding 3500kg. No reference is made in the MMM article regarding motorhomes with a GVW exceeding 3500kg, but I assume these will be continue to be placed and taxed in the Private HGV VED class.

[Charles Chodkowski]

Let's hope that's true for all of us with vans over 3500kg.

[Derek Uzzell]

Graduated VED for new ‘vans’ based on their CO2 emissions and effective from 1 April 2021 is mentioned in this 2018 article.

 

https://www.activacontracts.co.uk/news/budget-new-two-category-van-ved-regime-to-be-introduced-in-2021-to-help-green-fleets.html

 

”...the new system takes into account the weight of vans by introducing a two-category approach - small and medium sized vans in one category and large vans in a second category. The two-category approach, will be graduated by CO2 when a van is first registered, followed by a standard rate for the second year onwards as with car Vehicle Excise Duty”

 

See also

 

https://tinyurl.com/y25n727a

 

This recent (17 November 2020) link goes further than the MMM announcement, saying that the U-turn affects not just motorhomes but light goods vehicles generally.

 

https://www.bvrla.co.uk/resource/government-postpones-new-ved-regime-for-vans-and-motorhomes.html

 

BVRLA Senior Policy Advisor Thomas McLennan responded to the Government’s VED announcement; "We welcome HM Treasury’s confirmation that motorhomes will continue to be classed as Private/Light Goods for Vehicle Excise Duty purposes and are supportive of the Government’s decision to scrap its plans to introduce a new graduated VED scheme from April 2021.”

 

When motorhomes were originally going to be treated as ‘cars’ where graduated VED was concerned, a motorhome’s Gross Vehicle Weight (GVW) wouild have been ignored. When that idea was dropped, there was a return to the age-old GVW-related Private/Light Goods and Private HGV VED arrangement currently in force.

 

Although the MMM article and the last link refer only to the Private/Light Goods VED class, there’s no reason to think that new motorhomes with a GVW exceeding 3500kg would be assigned to a VED class other than Private HGV.

 

(Whatever happens, any VED-related changes won’t be imposed retrospectively.)

[rayc]

All the more reason to view the Governments decision to retain the regime that lasted for such a short time for the small number of owners as spiteful and vindictive. I would be feeling particularly aggrieved if I was one of those owners who will be paying a large excess for up to 6 years.

[John52]

Thanks for the update

I hope this U turn has not come too late for UK manufacturers.

[Derek Uzzell]

rayc - 2020-12-09 4:49 PM

 

All the more reason to view the Governments decision to retain the regime that lasted for such a short time for the small number of owners as spiteful and vindictive. I would be feeling particularly aggrieved if I was one of those owners who will be paying a large excess for up to 6 years.

This March 2020 forum thread reported the reversion to the archaic Private/Light Goods and Private HGV VED classes for motorhomes

 

https://forums.outandaboutlive.co.uk/forums/Motorhomes/Motorhome-Matters/Budget-and-VED/54621/

 

and the 11 March 2020 HMRC policy paper clearly said

 

The change in the law will apply from 12 March 2020.

 

Motorhomes (type approved M1SA) first registered prior to 12 March 2020, with an eligible CO2 emissions figure, will pay graduated VED as a petrol or diesel car.

 

The potential for motorhome-related graduated VED (based on a CO2 emissions figure) was there from as early as 2013, but the only thing that stopped that policy being applied wholesale was because very few motorhome manufacturers provided a CO2 emissions figure for their products.

 

Then, suddenly, it became evident that motorhome manufacturers would normally need to provide a CO2 value and this exposed new motorhomes to the imposition of graduated VED plus a ‘luxury’ tax. This of course did not go down well with the UK motorcaravanning community who - for no obvious reason - believed that they were a special breed. ;-)

 

As far as I’m aware the only retrospective change to VED classification was when the DVLA decided to allow VW “California” models to be re-registered in the Private/Light Goods class rather than the graduated emissions ‘car’ VED classes, but that decision was rescinded not too long after and buyers of California motorhomes have been paying graduated VED since then.

 

When people chose to buy motorhomes when graduated VED (+ the luxury tax) was applying to those vehicles, they would have been well aware of the cost. It wasn’t anticipated that there would soon be a reversion to the old PLG/PHGV arrangement and, when that did happen, it did not affect those motothomes that had attracted graduated VED. It also wasn’t anticipated that there’d be a COVID-19 pandemic that would impact on businesses running fleets of vans, and it’s this that has caused a halt to the introduction of the ‘light goods’ graduated VED scheme that motorhomes would have been attached to.

 

It’s probable that the VED-related plans that would have affected motorhomes from April 2021 will be reintroduced at some future point, as there’s clearly a ‘need to go green’ groundswell. But if (when) that happens, would you be happy that the (almost certainly) higher VED rates be imposed retrospectively to motorhomes to which PLG/PHG rates apply?

 

(It’s always offended my sense of logic that a massive 9-metres long 6-tonne motorhome should currently attract £165 annual VED, whereas the annual VED rate for a dinky little 5-metres long 3.3tonne panel-van conversion is £270. But the UK’s VED system is an artificial construct and logic doesn’t come into it.)

 

[John52]

Derek Uzzell - 2020-12-12 8:48 AM

Then, suddenly, it became evident that motorhome manufacturers would normally need to provide a CO2 value and this exposed new motorhomes to the imposition of graduated VED plus a ‘luxury’ tax. This of course did not go down well with the UK motorcaravanning community who - for no obvious reason - believed that they were a special breed. ;-)

The graduated VED was supposed to be a deterrent to choosing unnecessarily powerful gas guzzling polluting cars. 140mph car on roads you can only do 70 etc. If petrolheads can afford to waste money on an overpowered car, and ignore its higher pollution, they can afford to pay more VED.

But the motorhome buyer does not have that easy choice of choosing a sensibly powered vehicle at reasonable VED, or an overpowered one at a punitive rate of VED.

So, with the motorhome buyer, there is no point in the deterrent of a punitive rate of VED.

[Derek Uzzell]

You said much the same thing in your posting of 30 August 2019 10:55 PM on the 2nd page of this earlier forum thread, but that argument is specious in my view.

 

https://forums.outandaboutlive.co.uk/forums/Motorhomes/Motorhome-Matters/Huge-tax-increase-for-new-motorhomes-/52889/

 

As I said then

 

It’s possible to check on-line the CO2 emissions value relating to new cars. Doing so will show that a combination of a high CO2 value and a high purchase price is quite common, and also that the vehicles involved are luxury and/or high-performance type that a buyer will have little justification for purchasing except that a) they have the necessary funds and b) that they want to own that particular vehicle.

 

As far as I’m concerned new motorhomes are little different. Their purchase will be a ‘lifestyle’ choice rather than a necessity and I really don’t see why anyone choosing to spend (say) £50K on a new motorhome should expect to pay less VED than anyone choosing to spend a similar amount of money on (say) a high-powered petrol-engined Jaguar sports-car.

 

Motorhomes are marketed as ‘leisure’ vehicles rather than essential and nobody HAS to buy one. It would be like caravanners suggesting that, because new caravans were getting heavier, they were COMPELLED to buy a big 4x4 to tow them - but it’s not compulsory to buy a new caravan in the first place.

[John52]

Derek Uzzell - 2020-12-12 12:34 PM

 

nobody HAS to buy (a motorhome)..

What about full timers?

Even if its a leisure vehicle they don't have a realistic choice of engine size (and consequently pollution) like they do with a car.

[Derek Uzzell]

The percentage of ‘full timers’ within the overall total of UK-registered motorhomes is minuscule and (I suspect) most UK people who have become full timers have done so as a deliberate lifestyle choice rather than being forced into this by personal circumstances.

 

The fact that motorhomes suitable for living in long term are likely to be large and, consequently, require a powerful motor of a type that produces substantial amounts of CO2 seems academic to me. Besides which, when graduated VED was being applied to new motorhomes, I very much doubt that those vehicles were being bought by full timers.

[John52]

I get what you are saying, a motorhome is usually a luxury.

But when you buy a car, you have a choice of a high or low emission vehicle.

The fact this punitive tax is levied only when the vehicle is new suggests its supposed to be an incentive to choose the low emission car.

When you buy a motorhome you don't have a choice of high or low emission vehicle.

Thats the difference

(and I'm impartial because mine is taxed as a van)

[Derek Uzzell]

All you are doing is trotting out the arguments that the NCC (and others) put forward in 2019 and that were detailed here

 

http://www.fairmotorhometax.org/

 

http://www.fairmotorhometax.org/get-the-facts

 

People don’t like paying tax and there was no doubt that the imposition of graduated VED on new motorhome sales was going to be unpopular. But the option was always there for buyers to decide whether or not to purchase a brand new ‘luxury’ vehicle when they knew full well that there’d be a hefty tax bill.

 

If it’s believed that those motorhomes that were assigned to the graduated VED classes before that policy was reversed should now be moved into the P/LG or PHGV VED classes (which HMRC say won’t happen) and a refund made to the vehicle owners, perhaps those owners (plus the NCC, motorhome clubs and dealerships) should get together and lobby the government and/or raise a suitable petition.

 

It’s stating the obvious, but - unless the number of motorhomes affected is quite small (perhaps rayc can say how many) and they all still have their original owners - carrying out a reassigning/refunding exercise would be far from straightforward.

 

This 2020 AutoExpress article discussed possible retrospective changes to VED

 

https://www.autoexpress.co.uk/news/351849/drivers-could-pay-ps2135-year-road-tax

 

that would have penalised certain vehicle owners by siignificantly increasing the VED rate that applied to their vehicle when they bought it. The article’s final paragraph says

 

Commenting on the consultation, Edmund King, AA president, added: “ The public will expect a fair system of vehicle taxation and hence any changes shouldn’t apply to those that have already bought vehicles in good faith. For new vehicles the first year VED often gets lost in the purchase price of the vehicle but in subsequent years having a fair charge based on carbon emissions would make sense. We would welcome the idea of continuing with a zero rating for full electric vehicles and highly discounted rates for hybrids.”

 

People who purchased motorhomes when graduated VED was being applied to motorcaravans bought those vehicles ‘in good faith’, and they would definitely be aggrieved if a new even more expensive VED system had subsequently been introduced and the higher charges imposed on them retrospectively.

 

So if retrospective VED ‘punishment’ should (rightly) be considered unacceptable, that should also be the case for retrospective VED ‘rewarding’.