This month at a glance
Welcome to our Industry Insights – February 2025 blog, your monthly summary of all the sector-specific updates which will help you optimise your fleet.
Read on for news of digital driving licences, Manchester’s Clean Air Zone, double cab pick-up changes, and the EV charging VAT debate.
Digital driving licences
Voluntary digital driving licences are to be introduced later this year. Available as part of a virtual wallet in a new government app, the licence will be accepted as a form of ID for buying alcohol or voting.
Physical licences will still be issued, and when the digital licence is launched, a physical version will still be needed when hiring a vehicle at a rental company.
Read more
Manchester Clean Air Zone (CAZ)
The Government has backed plans to improve air quality in cleaner buses and taxis, rather than charging drivers.
The CAZ has been on hold since 2022, while the Greater Manchester Combined Authority explored alternative proposals to reduce air pollution, and a new set of measures have been signed off that will be sufficient to meet legal obligations to reduce nitrogen dioxide pollution. These include:
- 40 zero-emission buses
- 77 Euro VI standard buses
- £5m for local traffic management
- £8m to support taxis move to cleaner vehicles.
Double cab pick-up truck tax changes
From 6 April 2025, double cab pick-up trucks will no longer be classed as vans for Benefit-in-Kind (BiK) tax purposes. Instead, they will be treated as cars, leading to higher BiK taxes for those using these vehicles for personal use.
However, if you purchase, lease, or order a double cab pick-up before 5 April 2025, the current rules will apply until either:
- The vehicle is disposed of
- The lease expires
- 5 April 2029.
| Example impact | |||
|---|---|---|---|
| Van BiK (2024/2024) | Car BiK (2025/2026) | ||
| Van benefit value | £3,960 | P11D | £40,000 |
| Tax for higher rate taxpayer | £1,584 (£132/month) | CO2: 160g/km | 37% |
| Car benefit charge | £14,800 | ||
| Tax for higher rate taxpayer | £5,920 (£493/month) | ||
VAT rate on EV charging
MPs will soon discuss EV charging VAT exemption, where a VAT exemption in its entirety is proposed on public charging. At present, those charging at home pay 5% VAT on electricity. However, a customer using a public charger faces a 20% VAT rate. The debate will go ahead on 13 June 2025, and the bill would still have several more stages to go through until it could become a law.
Emission testing of plug-in hybrid vehicles (PHEVs)
The emissions testing of PHEVs has changed, and will now have their CO2 emissions calculated through the Worldwide harmonised Light Vehicle Test Procedure (WLTP). The BVRLA has produced a fact sheet that summarises the changes and possible impacts with some indicative changes.
New LCV on the horizon
Flexis, a company which is a joint venture between Renault, Volvo and CMA CGM, has developed a new generation of logistic vehicles. The line-up consists of three models, and each vehicle having a low floor height, high-capacity battery solutions, and a range of up to 280 miles WLTP. Serial vehicle production is expected to start in mid-2026 at Renault Group’s Sandouville plant in France.
