We explain the Government tax switch to WLTP

The government has confirmed that it will change the system for measuring carbon dioxide (CO2) emissions for company car benefit-in-kind tax and Vehicle Excise Duty purposes to the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) in two years’ time.

The new rules will come into force from 6 April 2020, subject to consultation. The Department for Transport (DfT) is also intending that all vehicle manufacturers will change over to new WLTP fuel consumption figures in their promotional material and advertising for all vehicles in less than a year’s time, from 1 January 2019.

Details of the proposed change-over to WLTP from the current New European Driving Cycle (NEDC) system for measuring vehicles CO2 emissions and MPG is contained in a consultation document – ‘Road Vehicles: Improving Air Quality and Safety’ – published by the DfT.

The consultation also outlines the fact that the government is looking at creating an offence relating to motor manufacturers supplying vehicles fitted with emission defeat devices following the recent ‘dieselgate’ scandal and, what it calls, “the strong imperative to improve air quality” as set out in the ‘UK Plan for Tackling Roadside Nitrogen Dioxide Concentrations’.

The consultation seeks views on new penalties, potentially unlimited fines, for vehicle manufacturers supplying vehicles fitted with defeat devices, and proposals to implement various safety and environmental rules, including the latest European Union emissions standards for cars, vans and buses following the UK’s exit from the European Union.

On ‘dieselgate’ and other matters, the consultation document says: “The scandal has shown the need for stringent penalties for manufacturers fitting devices to circumvent the regulatory tests, to provide a sufficient deterrent in the future.

“Standards on vehicle engines – known as Euro Standards – which should have led to major reductions in emissions of nitrogen dioxide (NO2) from vehicles, have failed to deliver, particularly for diesel vehicles.

“The UK led the way in Europe in pushing for tough new type approval standards for cars and vans, including the ‘real world’ driving emissions tests that start to take effect from September this year, alongside tougher laboratory tests.

“Our proposals cover the introduction of these new standards, as well as the similarly stringent Euro6 standards for buses and new safety standards for HGVs, for vehicles built in low volumes.

“The tougher laboratory test should improve the accuracy of the fuel economy figures quoted by manufacturers for comparison purposes and we are proposing that all car manufacturers shift to using the new testing results in publicity and labels from 1 January 2019. “

There are also more details regarding the process around the WLPT here.

The consultation document continues: “On 23 June 2016, the UK referendum on European Union membership took place and the people of the UK voted to leave the European Union. Until exit negotiations are concluded, the UK remains a full member of the European Union and all the rights and obligations of membership remain in force.

“During this period the government will continue to negotiate, implement and apply European Union legislation. The outcome of these negotiations will determine what arrangements apply in relation to European Union legislation in future once the UK has left the European Union.”

On the creation of a new offence of supplying a vehicle using a defeat device, or other similar functionality, to deliberately circumvent type approval regulations, irrespective of which national authority is used to obtain type approval, the government’s intention is to make such an offence applicable to any, and all, elements of the supply chain – the manufacturer, importer or dealer/ distributor.

However, the consumer would not be subject to a penalty for purchasing such a vehicle or selling it second-hand.

The government plans to introduce legislation applicable to the new rules during April this year following the consultation. The consultation document is available to download here.