What could the emergency budget hold for motorists?

Motorists are waiting to hear what the coalition government's emergency budget has in store for them, amidst feats of mass spending cuts and tax rises.

The Conservative Liberal government is taking drastic measures in announcing an emergency summer budget to address the hefty budget deficit and ensure Britain remains a leading economic player. Whilst the budget has been confirmed by ministers, the public will have to wait until June 22nd to hear the results.

Nevertheless, as with any unveiling, rumours are circulating around what the budget could mean for UK motorists. According to Parkers, the new government could stick with former Chancellor Alistair Darling's 1p rise in fuel duty, but compensate for this by introducing a fuel stabiliser system to keep pump prices steady.

It is expected that Chancellor George Osborne will announce a VAT rise from 17.5 per cent to 20 per cent, raising £11 billion per year towards the deficit according to Car Magazine, who estimate that tax on a £20k new car could mean £4000 going to the Treasury. Nevertheless, a rise in VAT could spell an increase in inflation which the Tories have admitted they would like to avoid.

Prompting both new and used car buyers to exercise caution when choosing gas guzzling polluters, the government is also set to announce that the most polluting models will be faced with road tax rises. As well as picking the greenest vehicles, car buyers may also need to consider off-roaders as with spending cuts imminent in the Department of Transport, some road maintenance projects could be cancelled.

 

 

 

Wendy Goh, London, BMw 325D M Sport

Lee Pearce, Hertfordshire, Vauxhall Corsa