UK Chancellor Alistair Darling unveiled plans to support new low carbon industries and boost the use of electric vehicles in businesses through lower taxation.
Darling said that the government would scrap taxes on electric company cars for the next five years and announced 100% first year capital allowances for businesses using electric vans.
Company cars account for around 1.1million of the vehicles on the UK roads, only around fifty of those are electric and the new proposals will encourage businesses to look at the options available.
Companies currently pay National Insurance contributions and employees pay income tax based on the cost of the car and the CO2 emissions, electric cars attract a 9% tax while fossil fuelled vehicles range from 10 to 35%.
Darling also announced extra funding for low carbon industries, pledging an investment of £160 million across a range of low carbon public and private projects through existing schemes — along with 90 million pounds earmarked for green European infrastructure schemes.
He also said the government would double its commitment to carbon capture and storage, by supporting four new projects with technology that captures CO2 and stores it underground.
Darling also outlined plans to introduce a scheme to replace 125,000 old and inefficient central heating boilers in homes across the UK with a cash back scheme similar in principle to the car scrappage scheme.
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