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Workplace parking tax scheme given go-ahead

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The government has given the green light to a scheme that will see businesses paying tax on staff parking spaces.

The Workplace Parking Levy (WPL) has been approved by Transport Minister, Sadiq Khan, with Nottingham City Council the first local authority likely to introduce it.

Under the scheme, businesses with 11 or more parking spaces reserved for staff will be charged £185 a year for each. This figure could rise to £350 by 2014. Employers will be entitled to pass the costs of the levy on to their employees.

Although Nottingham City Council have been told they can implement the tax, it will not come into force until 2012. The delay is intended to help businesses cope with the recession.

Nottingham City Council, the first and so far only authority to submit an application to use the scheme, estimates that the levy will raise £11.3 million.

However, a number of other councils in England are believed to be considering the WPL, and business and motoring groups have claimed that, if rolled out across the country, the levy will add £3 billion to firms’ costs.

David Frost, the director general of the British Chambers of Commerce (BCC), said: “Although they have delayed implementation for two years, Nottingham City Council’s decision to impose a Workplace Parking Levy is still a blow to the local business community.

“The key priority must be allowing businesses to drive recovery by creating wealth and jobs for the local area – so we would urge the Council to reconsider the levy altogether.”

The AA described the levy as a tax on jobs. A spokesman for the motoring organisation added: “These tariffs apply around the clock, which is especially unfair on shift workers who rely on their cars because public transport is not available.

“This is more about generating a revenue stream than reducing congestion and will require snooping to enforce it properly. We are afraid that this scheme could expand to other cities, damaging business and industry at a time when they need support not punishment.”

The Department of Transport responded to criticisms by saying that it is for local authorities to decide what measures are appropriate for improving transport and tackling congestion in their area.

“The Workplace Parking Levy schemes may only be introduced if they will contribute to the achievement of local transport policies, and all revenues must be reinvested in local transport,” a spokesman continued.