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News.


March 2008 Budget Update

Download March 08 Budget Report


Smoking Ban

On 01 July 2007 the Health Act became law in England. It requires all enclosed public places and workplaces to be smoke-free.

The regulations also extend to company vehicles. These are considered extensions of the workplace.

The new Health Act requires all cars and vans to be smoke-free if:

• they are used by members of the public; or
• during the course of paid or voluntary work the vehicle is used by more than one person – even if this is at different times.

If the above conditions are met, all such qualifying vehicles must be smoke-free and display the internationally recognised no-smoking sign. It must be colour and at least 70mm in diameter in England (but 75mm in Wales and Northern Ireland).

There are certain exceptions to the regulations. Company cars are exempt from the smoke-free regulations if they are for the sole use of one person.

Convertible cars are also exempt, but only when the roof is fully retracted. At all other times they must comply.

Private cars used on business are also exempt from the smoke-free regulations, provided business usage is below 50% of the vehicle’s annual mileage. If business mileage exceeds 50%, then the new Health Act applies.

Why is the Health Act being introduced?

The smoke-free regulations are being introduced to counter the harmful effects of second hand or passive smoking. Second hand smoke increases the risk of lung cancer in non-smokers by 24% and the chances of heart disease by 25%.

It is anticipated that thousands of lives will be saved over the next decade through the introduction of smoke-free regulations.

A secondary reason is to provide an environment that is more supportive to those smokers wishing to quit.

Who has responsibility to enforce smoke-free regulations?

The person responsible for managing the company’s fleet of vehicles has a legal obligation to ensure no-smoking signs are displayed in all qualifying vehicles.

The new smoke-free regulations require the driver to prevent someone smoking in a smoke-free vehicle, as well as those with managerial responsibilities for the vehicle fleet.

What are the fines for non-compliance?

For management failure to display no-smoking signs in a smoke-free vehicle there is a £200 fixed penalty fine, which reduces to £150 if paid within 15 days. The maximum fine payable on conviction is £1000.

For smoking in a smoke-free vehicle there is a £50 fixed penalty fine, which is discounted to £30 if paid within 15 days.

For management failure to prevent smoking in a smoke-free vehicle there is a maximum fine of £2500 on conviction.

What about the rest of the United Kingdom?

Wales introduced its version of the Health Act on 02 April 2007, while Northern Ireland introduced smoke-free regulations on 30 April 2007. The regulations are similar to those of England’s Health Act.

Scotland, however, introduced its own workplace ban in 2006. This differs from the regulations governing the rest of the United Kingdom. While it bans smoking in commercial vehicles, this regulation does not apply to company vehicles.

Where can I find no smoking stickers?

The Department for Health will be supplying free no smoking stickers. Companies can register to receive information packs on the new smoke-free regulations by calling 0800 169 169 7.

What are Vehicle Management Companies doing?

We will be putting no-smoking stickers into the driver packs. Production of the stickers is currently in progress.

If I want further information, where should I go?

There is extensive guidance on the internet at www.smoke-freeengland.co.uk.


Below are the highlights of the Budget announcement:

  • Existing emissions-based company car tax rules unchanged for 2006/7 and 2007/8.

  • Minimum percentage rate for the calculation of company car tax for qualifying cars reduces to 135g/km in 2008/9.

  • New 10% band introduced for cars emitting less than 120g/km of CO2 from 2008/9.

  • Government set charge of £14,400 for fuel benefit charge calculations maintained for 2006/7.

  • Vehicle Excise Duty changes include new top annual rate of £210 for petrol cars (£215 for diesels) emitting over 225g/km of CO2 (Band G).

  • The VED rate for Band A cars is reduced to £0, although currently there are no petrol or diesel cars available on the UK market that qualify.

  • Across the board changes to other rates of VED.

  • Reduced rate of graduated VED for alternative fuel cars extended to include those manufactured to run on high blend bioethanol and biodiesel.

  • Fuel duty rate increases frozen until September 1.

  • Duty rates on LPG (Liquefied Petroleum Gas) to rise by the equivalent of 2.25p/litre from September 1; duty rates on CNG (Compressed Natural Gas) to rise by the equivalent of 1.25p/litre from September 1.

  • The duty differential between LPG and main road fuels will be reduced by the equivalent of 1p/litre each year to 2008/9.

  • Euro IV emissions standards to become mandatory for all new vans registered after December 31, 2006.

  • Government will consider the case for incentivising the early uptake of Euro V emissions standards through company car tax and other instruments

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