ACFO renews call for plug-in hybrid AFRs
16 November 2018
Author: Sean Keywood
Fleet operator organisation ACFO has reiterated its appeal for HMRC to publish advisory fuel rates (AFRs) for plug-in hybrid cars.
Earlier this year, following fleet industry campaigning led by ACFO, an advisory electricity rate was published for fully electric vehicles.
However, no such rate was published for plug-in hybrids. For mileage reimbursement purposes they are currently treated as either petrol or diesel cars.
ACFO is calling for such rates to be introduced, linked to both electric mileage range and the current engine capacity-based AFRs for petrol or diesel cars, depending on which fuel powers the internal combustion engine component of the plug-in hybrid in question.
ACFO, which has an ongoing petition calling for change, says its case has been strengthened further by the publication of data from TMC that warns plug-in hybrids are being used inefficiently by some fleet drivers, with some never charging them at all.
ACFO chairman John Pryor said: "TMC's data came as no surprise to ACFO. Plug-in hybrid vehicles are at their most efficient when driven for as many miles as possible on electric power.
"Therefore, particularly with technology advances likely to increase the electric range of such cars, publishing appropriate advisory electricity rates for plug-in hybrid cars will help to encourage drivers to use the car in the optimal, environmentally-friendly way."
Pryor said that with plug-in hybrids a major part of manufacturers' future model plans, an increasing number are set to reach company car choice lists.
"However, without an incentive linked to how such ultra-low emission vehicles are used on the road, it will not prevent drivers using the combustion engine alone in a plug-in hybrid car," he said.
"The fleet industry continues to be awash with stories of company car drivers choosing plug-in hybrid vehicles in pursuit of lower BIK tax bills, but not reaping fuel economy savings.
"As a result, some contract hire and leasing companies have acknowledged they have had plug-in hybrids returned, with fleets incurring early termination charges, due to poorer than anticipated mpg returns. However, the reality is that those cars are not being used in the way they were intended."
Pryor said that ACFO acknowledged it was possible for businesses to calculate rates themselves, then obtain permission from HMRC to use them to reimburse drivers. But this would be extremely time consuming and difficult.
He added: "It is almost certain that businesses are currently paying a higher mileage reimbursement figure to company car drivers at the wheel of plug-in hybrids than if official figures were published for those cars.
"I would urge all fleet decision-makers and the fleet industry as a whole to sign ACFO's petition and put pressure on HMRC to introduce an appropriate mileage reimbursement rate for plug-in hybrid cars.
"The figures we have calculated deliver a simple pence per mile mechanism that is both cost effective for employers - so they are seeing a benefit from the more efficient technology - while employees are being fairly reimbursed for business mileage, based on the capabilities of the plug-in vehicle technology."