BUDGET REPORT

9 MARCH 1999

COMPANY CARS

Pending a change to a system of taxing company cars based on carbon dioxide emissions in 2002/03, the effective rates of taxable benefit have been amended for the years 1999/2000 to 2001/02.

           Effective rate of taxable benefit           Car under 4 years           Car 4 years or over

           Standard taxable benefit                                     35%                           26.25%

           Business mileage 2,500-17,999 p.a.                    25%                           18.75%

           Business mileage 18,000 and over                      15%                           11.25%

Generally, second cars will be taxed on the standard 35 per cent benefit, with a reduction to 25 per cent if business travel if that car exceeds 17,999 miles a year.

BRAND NEW FLEET CAR OR OLDER EXECUTIVE CAR -

THE TAX COSTS COMPARED

                                                Ford Mondeo 2.Oi Ghia                               Mercedes Benz E220

     Purchased                                        6.4.98                                                     6.4.98

     Registered                                        6.4.98                                                      5.4.95

     Original list price                                £17,345                                                 £25,360

     Actual price                                       £15,600                                                 £15,900

     List price                                            17,345                                                   25,360

     Standard benefit (35% list price)           6,071                                                      8,876

Reduction for car four or more years 

old on 5 April 2000 (1/4)                                                                                         2.219  

Benefit taxable for 1999/2000                   6,071                                                       6.657

     Monthly tax for 23% taxpayer             £116.36                                                   £127.59

Monthly tax for 40% taxpayer                 £202.37                                                    £221.90

VAT SCALE CHARGE - VAT DUE

VAT scale rates for 1999/2000 are as follows:

PER QUARTER PER CAR