ULEV Car Companies in UK to Get Low Tax Rates in 2020-2021; Will This Encourage Car Companies to Go Green? Video

Dec 07, 2016 06:42 AM EST | Leonora

ULEV or ultra-low emission vehicle companies in UK will enjoy low tax ratesin 2020 to 2021 as part of the government's efforts to promote green and clean environment by encouraging the use of vehicles that have minimal emissions. The low tax rates for ULEV car companies will be effective in 2020-2021. Data had been released as to new rates in taxes for all ULEV car leasing companies in the UK.

To make all details clear to all ULEV car companies, a summary of Finance Bill 2017 that will soon be passed in the Parliament was formulated, with a chart showing Company Car Tax Rates 2020-2021. Under the new tax rates, vehicles with 150 to zero emission will get the highest tax benefits while those with high level of emission may have to pay more than what they used to pay, according to LeasePlan. The new tax rates favoring ULEV was intended to convince car companies to shift to plug-in hybrid and electric vehicles which had been considered as green cars because of the absence of toxic emission.

Further, this means expanded market for hybrid vehicles that can be considered as ULEV such as the Toyota Prius, Nissan Leaf and BMW i8. While it is still several years before the new tax rates will become applicable, car leasing companies can shift to plug-in hybrids and electric vehicles in time for their new lease contract and save money on taxes, according to Business Car Manager.

This means that car leasing companies might select plug-in hybrid and electric cars during their next purchase in order to be able to enjoy reduced tax rates in 2020-2021, according to Days Fleet.  The UK government's new tax law for ULEV car companies is expected to convince people to buy such types of vehicles in order to save on taxes.

Aside from the money-saving effect, having vehicles with very low emissions would translate to a greener and safer environment in the near future.

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