In the week that Jaguar has confirmed it will become an electric-only brand, it is interesting to see comments by Lisa Brankin, Ford UK's chair and managing director, around the need for the government to do more to support electric car manufacturing and demand in the UK. 

Ms Brankin told BBC Radio 4's Today programme: "The one thing that we really need is government-backed incentives to urgently boost the uptake of electric vehicles."

These comments re-iterate the key role that government policy needs to play in encouraging the take up of electric cars through a combination of incentives through the taxation system and legislation in banning petrol cars. 

In Labour’s first Budget for more than 14 years, Rachel Reeves confirmed that there would continue to be incentives around electric company cars until 2030 and that air passenger duty rates for 2026-27 will increase by 13%, and by a further 50% for larger private jets. However, these electric car incentives have been reduced with the appropriate percentage for zero emission and electric vehicles will increase by 2 percentage points per year in 2028/29 and 2029/30, rising to an appropriate percentage of 9%. Although there continues to be a large differential in benefit in kind charges between electric and non-electric cars.

Appropriate percentages (AP) for hybrid cars with emissions of 1 – 50 g of CO2 per kilometre will rise to 18% in 2028-29 and 19% in 2029-30 and all other vehicle bands will increase by 1 percentage point per year in 2028-29 and 2029-30. The maximum AP will also increase by 1 percentage point per year to 38% for 2028-2029 and 39% for 2029-2030.

It will be interesting to see how reductions in the incentives for individuals to purchase electric company cars in the budget impact the ongoing sales and the wider car market looking forward. 

If you do have any queries on the employment tax changes outlined in the Budget then please do get in touch.