After just one week, the government has backtracked on plans to classify double cab pickup trucks as cars, which would have resulted in huge tax hikes
HMRC announced the change on 12 February with updates to guidance, stating that from 1 July 2024, double cab pickups with a payload over one tonne were going to be classified as cars for tax purposes. In the eyes of HMRC these were more often than not being used as personal vehicles.
Now in a major reversal, the government has abandoned the plans, reacting to loud criticism from farmers and the motoring industry.
In a statement, the Treasury said: ‘The government has listened carefully to views from farmers and the motoring industry on the potential impacts of the change in tax treatment.
‘The government has acknowledged that the 2020 court decision and resultant guidance update could have an impact on businesses and individuals in a way that is not consistent with the government’s wider aims to support businesses, including vital motoring and farming industries.’
The rules have now reverted back to the original guidance that was issued on 6 April 2002 and are set to be officially reversed at the next Finance Bill.
Nigel Huddleston, financial secretary to the Treasury, said: ‘We will change the law at the next available Finance Bill in order to avoid tax outcomes that could inadvertently harm farmers, van drivers and the UK’s economy.’