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Blog - Published 22nd November 2017

Chancellor should offer transitional relief in anticipation of Clean Air Zones.

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In order to ease pressures on fleet operators, hauliers, freight forwarders and other businesses in the transport and logistics sector, the Chancellor must introduce transitional in the Budget during the introduction of Clean Air Zones (CAZs).

Not long left now

There are now only a few months until the start date for the Ultra-Low Emission Zone (ULEZ) in London, and further air quality zones are predicted to roll out across the country.


Charges may apply

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Some of the ULEZ will be charged, meaning that drivers who enter the zone in vehicles that don’t meet the specified environmental standards will be forced to pay a fee. However, the uncertainty surrounding the nature of the restrictions in each zone is making it difficult for fleet operators and other transport businesses to plan-ahead. With many hoping for some level of transitional relief to provide much-needed support for businesses as they switch to greener vehicles.

Restrictions don’t look cohesive in nature

ULEZ and the CAZ are perfectly sound propositions in theory. However, with the zones being devised and implemented by local authorities, this has led to a lack of cohesion with regards to the precise nature of the restrictions and charges to be imposed.

The need for Transitional relief

Many feel it is imperative that the Chancellor considers the investment that a number of businesses have made in their fleets and their expected commercial lifespan.

Fixed term contracts

Some businesses are leasing vehicles, under agreements that may not end for years and may not be able to justify investment in new motors. The Chancellor must acknowledge the significant financial and administrative strain this will cause businesses in the sector and announce a transitional relief scheme to provide financial support.

Clean air zones are however damaging the market for second-hand vehicles due to the tightening emissions and fuel standards, resulting in no body investing in old motors anymore.


What else could be done?

The Chancellor could also provide incentives, such as additional tax credits, to encourage use of greener vehicles. However, this may be wishful thinking, considering the Government has just lowered the plug-in car grant for owners of electric cars.

Andrew Galliers - Menzies Accountant

Businesses in the sector understand the importance of protecting air quality and reducing CO2 emissions and are willing to make the transition to greener vehicles. However, rising costs, increasing administration and low operating margins mean that they urgently need support.

For further information, please contact Andrew Galliers on 01489 566745 or email agalliers@menzies.co.uk

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Posted in Blog, Transport & logistics

Andrew Galliers - ACA

Senior Manager

Andrew Galliers is a Senior Manager specialising in business audit and compliance advisory services and international accounting and tax issues.