Trade associations have called for a new super-deduction scheme to include eligibility for leasing and rental vehicles.

With the UK Government’s current super-deduction programme due to expire at the end of March, the associations, including Logistics UK and the BVRLA, are calling for a new and more flexible scheme to be implemented.

A letter to the Chancellor of the Exchequer to this effect has also been signed by CECA, EAMA, FLA, Forum of Private Business, Make UK, and MTA.

Logistics UK senior policy manager Denise Beedell said: “With the deadline for net zero by 2050 drawing closer and many logistics businesses operating on tight margins, continued support for investment is vital. 

“Businesses are increasingly assessing their operations to transition to greener technologies and, in addition to increased financial pressures, uncertainty remains regarding the best approach for decarbonisation.

“With costs rising, purchasing assets outright may not be the most economically viable – especially for those who only need use on a part-time basis. As a result, many businesses are looking to lease or short-term hire, so we are calling on government to maintain its support for investment and introduce a more flexible approach.” 

Beedell said that although logistics businesses were keen to decarbonise their fleets, they were already facing a 12.6% rise in vehicle operating costs, a reduction in energy support, and a potential 23% increase in fuel duty.

She added: “The creation of the suggested green super-deduction would provide much needed financial support and encourage greater investment in zero-emission technologies.”  

BVRLA director of corporate affairs Toby Poston said: “The leasing and rental exclusion in the current regime has created an unfair playing field that is hindering SMEs from making the leap to zero-emission commercial vehicles. 

“The enhanced allowances we’re recommending would boost business investment in zero emission technology and support the government’s ambitious phase-out targets.”