People who drive their own cars for community services – such as meals-on-wheels – business or even voluntarily – such as hospital drivers – are predicted to have their mileage allowances cut in the Budget.
Those who can claim expenses under the Approved Mileage Allowance Payments (AMAP) scheme, which is tax-free, may find that they are only allowed to cover 6,000 miles at the ‘higher’ rate of 40p per mile. Currently, they can claim up to 10,000 miles before the rate drops to 25p per mile and expenses have to be declared as taxable ‘earnings’ instead.
Edmund King, AA president, says: "These volunteers may not pay tax but, if paid above the government mileage rates, their insurance is invalidated. We are not convinced that the government has thought this through.
"Charges that the AMAP system encourages the use of more polluting vehicles are nonsense. The flat-rate 40 pence tax-free maximum barely covers the cost of running a brand new supermini and owners of bigger vehicles lose out because their running costs are greater. Drivers are often bound by contract to use their own cars and, by circumstance such as having children or personal finances, have to use the car they can afford. Blaming them for CO2 emissions and failing to reimburse the true cost of running a car is simply wrong and unfair."
Chairwoman Rowena Smith from the Community & District Nursing Association has also said that: "Nurses, along with many other British workers, cannot simply change the way they use their cars for work – it is built into their contract and penalising them for not having a company car is nothing short of a stealth tax on employment."
The AA points out that it very often those who live in rural communities, who have to travel a longer distance to access community services, who may well be most affected.