§ Mr. MillsTo ask the Chancellor of the Exchequer if he will make a statement on his assessment of the effect of his proposals on company car tax on the sale of cars at the upper end of the price range.
§ Mr. DorrellThe switch from scale charges to 35 per cent. of list price as the basis for personal tax liability on company car use will remove distortions in the new car market. Each car will be taxed on the basis of its individual list price, in response to the weight of views expressed during consultation. Our assessment is that these changes coupled with the abolition of car tax, the lowest interest rates in the EC, a competitive exchange rate, low inflation and sustainable economic recovery—will have a positive effect on sales of United Kingdom manufacturers' cars across the whole price range.