Vertu Motors CEO Robert Forrester has sharply criticised suggestions that the government is proposing to remove VAT exemption from Motability.
Speaking at the London Press Awards he said such a policy was extraordinary and would have serious consequences for those on Motability and wider business.
“Car ownership is subject to tax at every point: VAT on purchase price, registration fees, luxury car tax on modest cars, vehicle excise duty, company car tax, VAT on fuel and then fuel duty on top, road tolls and parking charges.
“If that is not enough the Government seems to be considering a new tax. Let’s call it what it is; a Motability tax, or a Blue Badge Tax.
“Instead of tackling the real problem of who qualifies for the subsidised cars for disabled people, we are hearing about an extraordinary policy to levy VAT on the vehicles – a Blue Badge tax which could increase what the car costs by an average of £6500!
“This would force disabled people to choose the cheapest models or abandon them altogether,” he said.
Forrester said a move against Motability would have wider consequences.
“Some disabled people need more complicated cars, such as estates or larger hatchbacks.
“The idea has industry consequences too; it would increase the cost of the cars, which would reduce the numbers ordered, which would reduce the numbers manufactured in the UK costing jobs, and also leading to a reduction in cars entering the second-hand market later, thus increasing the cost of used cars in three years’ time,” he said.
