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NFDA condemns VED exemption removal for older vehicles

National Franchised Dealers Association (NFDA) has hit out at the removal of the vehicle excise duty (VED) exemption for older vehicles.

It says the move will damage the market value of thousands of vehicles and in turn, dealers and owners alike.

The issue has been picked up by the national press and the NFDA only this week. AM first reported in its April 4 issue that the VED changes would impact all vehicles registered from 2001.

The government has abolished an existing VED exemption on higher road tax rates for vehicles emitting more than 225g/km of CO2 registered between March 2001 and March 2006.

It means that owners of high emissions cars registered during that period will face an annual VED bill of £455 in 2010, compared to the £285 they paid before March's Budget announcement.

It was to encourage owners of these vehicles to replace them with newer, environmentally friendly models.

However, Sue Robinson, NFDA director, disputed the effectiveness of this measure: “The extra costs involved in running these older vehicles will make them extremely unattractive to potential buyers, thereby ruining trade-in values for dealers.

"At the same time, many motorists may feel that they are better off running these vehicles into the ground rather than lose money selling up.

“As a result the measure is unlikely to achieve any substantial reduction in CO2 levels.”

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