Financial Resolutions, 1978: Financial Statement, Budget, 1978. - Benefits-in-kind
Considerable dissatisfaction has been expressed by employees affected by certain benefits-in-kind legislation introduced in 1976. This legislation imposed on employees who had the private use of employers' cars an income tax charge of 15 per cent of the cost of the car, subject to a minimum of £300.
I am satisfied that this position is unfair to many employees—in particular to those who have to use their cars extensively for business purposes. Accordingly, I have decided to repeal the relevant 1976 legislation, with effect from 6 April next, thereby restoring the previous basis on which the value of the benefit to the employee was computed by reference to the actual amount of private mileage as compared with total mileage. The cost of this relief will be £2 million in 1978.