Overview
- Reports say ministers are exploring ending VAT and insurance premium tax reliefs on Motability leases, a change estimated to raise about £1bn a year.
- Excluding premium marques such as BMW, Mercedes and Audi is under consideration, affecting roughly 40,000 higher-end vehicles on the scheme.
- Whitehall sources indicate removing tax breaks is likelier than tightening eligibility, with broader welfare reforms still being examined.
- Rachel Reeves said she "can't leave welfare untouched" this parliament as the 26 November Budget approaches and forecasters flag a large fiscal gap.
- Disability charities including Scope and Transport for All warn the plans would raise costs and risk isolating users of a scheme serving about 800,000–860,000 people.