Are we taxing the UK car industry into the ground?
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JLR is fighting for survival as thousands of jobs are put at risk, but are government taxes and regulations making life even harder for Britain’s remaining car industry?
It comes as no surprise that Jaguar/Land Rover (JLR) are in survival talks with the Govt as they plan to axe 4,000 jobs.
The firm is at the pinnacle of top-end UK luxury car production which, inevitably, comes at a price. A top-model Range Rover can carry a list price of around £180,000 and even their entry models, such as the Discovery Sport and Evoque, carry a list price of over £50,000, putting them all in the luxury tax bracket for new cars.
This adds an extra £440 per annum surcharge on top of the regular annual road tax just because it is deemed a luxury vehicle. This surcharge lasts for five years regardless of how many owners it has during this time.
Then there is the bizarre first-year road tax surcharge which depends on CO2 emissions and, for the very top models, can add up to a £5,690 ‘one-off’ fee on top of the £200 annual standard road tax.
Add in the five years @ £440 (£2,200) luxury tax and you start to get the idea that someone in the Treasury doesn’t like folk who can afford the best in life.
And this is hurting the JLR workforce very hard and they’re the ones who this mad taxation is really penalising. Plus the thousands of workers in the supply chains who support the motor industry and JLR in particular.
Chinese JAECOO ‘Mini-Range-Rovers’ look remarkably similar yet start around £25,000 and are therefore under the ‘Luxury Tax’ threshold. Offering all the space and look of a Range Rover at a fraction of the cost.
With the £112,000 Range Rover D300 losing around £25,000 in the first year, it is no wonder buyers are considering all other options.
Andy Burnham has promised ‘Problem solving, not finger pointing’, so he would be wise to think about deleting these archaic and self-destructive zero-emission vehicle (ZEV) mandate ideologies imposed on the UK’s remaining motor industry.
Shooting oneself in the foot comes to mind here while we let the foreign competition waltz in and steal what’s left of our once brilliant car industry.