Scrapping ECOS would slow EV uptake, warns NFDA
The National Franchised Dealers Association (NFDA) has urged Chancellor Rachel Reeves MP not to scrap the Employee Car Ownership Scheme (ECOS) in the Autumn Budget.
It has said the proposed changes would have damaging consequences for the automotive sector and its employees.
The proposed legislation says that all company cars made available under ECOS after 6 October next year would become liable for benefit-in-kind (BiK) taxation. The Treasury believes this will raise £275m in additional tax revenue in its first year.
However, the NFDA has written to the Chancellor stressing the role ECOS plays in enabling employees to access affordable vehicles and in supporting the transition to electric mobility.
Short-sighted
Sue Robinson, chief executive, said: “The government needs to consider the consequences of scrapping the ECOS scheme as it will damage the attractiveness of employment in the industry and reduce the number of new cars being registered.
“Removing the ECOS scheme would be short-sighted and detrimental to both the workforce and the wider automotive sector.
“For instance, it would slow the electrification process as many of the cars entering the nearly new market through ECOS are electric vehicles. It would also deter employees who might not otherwise be able to access a vehicle, and scrapping such an employee benefit would inevitably hinder staff retention.”
