Second budget of the new government. Chancelor Rachel Reeves states ‘My budget is about fair taxes, growth does not appear out of thin air’ There will be no increase to NIS, no increase to income tax, no increase to VAT.

IOC delivers you the Transport headlines that cover final mile with a tax for warehouses used by on-line giants. Mile charge for electrics, fuel duty frozen. We then add to hot of the press second lenses, bringing UKWA comments from Care Botte expertise on warehouse and Tony Cambell view on two wheel and L cat from the MCIA.

Tax for warehouses used by on-line giants – Warehouses above 500 k

Motoring tax focus

Electric mileage tax. 3p a mile for electrics and 1.5p a mile for hybrids (from 2028) (MCIA - Two wheel and L Cat out of scope)

But there will be more money for the electric car grant – 1.3 bn

Fuel duty frozen - cuts end April, but will be extended 5p to 2026

There will be a new app for drivers to find cheapest fuel.

Motability disability support will be barred to luxury cars.

Living wage is up from twelve twenty on to twelve seventy one

Chancellor spoke positively on building roads and committed to the Lower Thames Crossing.

On apprenticeships, including Express delivery, Chancellor committed apprenticeships would become entirely free for SMEs.

The UKWA UK Warehousing Association lens on the budget – rates on large warehouses.

The UKWA comments, ‘Normally we’d be pleased to hear the Chancellor of the Exchequer talking about warehouses in the House of Commons. Unfortunately, in her Budget Speech today, Rachel Reeves used the “warehouses of online giants” as a justification for imposing a business rates surcharge on properties valued above £500,000.

Clare Bottle, UKWA CEO, described the comment as a “cheap shot”. It was disappointing because the growth of online shopping has been driven by consumer demand, which the warehousing sector has responded to with agility. It was also disappointing because this tax increase hits all warehouses above the threshold, irrespective of sector. As the Chancellor surely knows, warehouses handle everything from medicines to components for the defence industry, as well as the goods sold in high street shops that are being given a cut in business rates. It’s short-sighted of the Government not to realise that increased costs for warehouses will flow into increased costs of goods.

The Treasury is expecting to raise a staggering £270million from 1,900 warehouses between 2026-29 through this change. As a result, for many UKWA members, this will be seen as another cost-increasing budget.

Another measure in the Budget that may affect UKWA members was the removal of the exemption on customs duty for low value imports (less than £135).

Positive were announcements around apprenticeships, including that the Government will start fully funding apprenticeships for under 25s in SMEs. The apprenticeship system has failed to fully deliver for the warehousing sector to date, so chance is welcome.

MCIA lens, covering two wheels and L Cat light vehicles.

The Budget introduced three major zero emission vehicle measures. Although they focus on cars, each has direct implications for the motorcycle and moped sector – and reinforces the need for motorcycle-specific policy treatment, which MCIA continues to press for.

1. New electric Vehicle Excise Duty (eVED) – From 2028, EV and plug-in hybrid cars will pay a new mileage-based tax alongside VED. MCIA point out, Importantly, all motorcycles and L-Category vehicles will be out of scope.

2. Expensive Car Supplement (ECS) raised to £50,000 for zero emission cars. From April 2026, the ECS threshold for zero emission cars will rise to £50,000. MCIA comment, by contrast, the £10,000 threshold applied to electric motorcycles is outdated and does not reflect the far higher cost of electric motorcycles relative to petrol equivalents. Without reform, two wheel sector risks being placed at a structural disadvantage. MCIA further comments, ‘The ECS change provides a helpful precedent by demonstrating that the Government is willing to adjust VED structures to support zero emission vehicle uptake.’

3. Electric Car Grant Extended to 2029–30 – The Government is allocating £1.3bn of additional funding to extend the Electric Car Grant for another five years. Meanwhile, the PiMG is set to end in April 2026. The extension of the Electric Car Grant provides a major opportunity. It shows that Government accepts the need for targeted incentives to support zero emission vehicle uptake, is prepared to allocate substantial funding to accelerate transition and understands that affordability is a barrier requiring intervention.

Mileage tax for EVs and hybrids