Dealer: the Taycan was good for us; it's now a disaster
Discussion
m12nathan said:
SWoll said:
The counter argument would be that the poorest in society aren't subsiding anything, it's the high earners who are subsidising them with tax contributions that far outweigh what they take out of the system over the same period?
As an example 4 x £30k earners will pay a combined £20k in tax over a year. 1 x £120k earner will pay £45k in tax over the same period.
Is society better off letting the £120k earner buy a Taycan, or reducing the tax burden on the 4 £30k earners? Which has a more positive impact overall? Make it easier for them to heat their homes and feed their kids or add another car to the stable?As an example 4 x £30k earners will pay a combined £20k in tax over a year. 1 x £120k earner will pay £45k in tax over the same period.
Fastlane said:
You seem to misundertand the tax benefits on EVs, as the government/ poor people aren't subsidising company cars.
The company buys/leases/PCPs the car at full price and then like a company ICE car purchase, can offset the depreciation against the company's profits and hence corporation tax. Nothing new here and no poor people are involved.
The driver of a company car then pays income tax on the benefit in kind. Because BiK tax on company cars had become so high in this country, there were virtually no company cars anymore, so I believe very little car BIK tax was being collected.
Then the government introduced the zero and now 2% BiK rate for EVs. Given the subsequent massive increase in company cars, the government I would imagine is getting at least as much if not far more BiK tax than previously. So again, no poor people subsidising £160k Taycans.
This enormous number of ex-company EVs are now starting to leave company fleets and appear on the second hand market. Given the sheer volume of them, they depreciate and become affordable to many others who don't have access to company car. The £160k Taycan will then be sold on for far less and the company will pay for the depreciation, in one form or another, not any poor people.
So, the poorest in society are not subsidising £160k Taycans or any other EV as companies are paying full price for them out of their profits, their employees are paying more tax and as has been well reported on here, EVs are becoming more and more affordable.
Example A.The company buys/leases/PCPs the car at full price and then like a company ICE car purchase, can offset the depreciation against the company's profits and hence corporation tax. Nothing new here and no poor people are involved.
The driver of a company car then pays income tax on the benefit in kind. Because BiK tax on company cars had become so high in this country, there were virtually no company cars anymore, so I believe very little car BIK tax was being collected.
Then the government introduced the zero and now 2% BiK rate for EVs. Given the subsequent massive increase in company cars, the government I would imagine is getting at least as much if not far more BiK tax than previously. So again, no poor people subsidising £160k Taycans.
This enormous number of ex-company EVs are now starting to leave company fleets and appear on the second hand market. Given the sheer volume of them, they depreciate and become affordable to many others who don't have access to company car. The £160k Taycan will then be sold on for far less and the company will pay for the depreciation, in one form or another, not any poor people.
So, the poorest in society are not subsidising £160k Taycans or any other EV as companies are paying full price for them out of their profits, their employees are paying more tax and as has been well reported on here, EVs are becoming more and more affordable.
Company makes £1m pre tax profit
Director A earns £250k
Example B
Company makes £840k profit as it bought £160k Taycan
Director reduces salary and takes Taycan instead paying 2% BIK instead of income tax
Which of the above results in a higher tax take?
Soupdragon65 said:
It’s a false argument because stopping the £120k earner buying the Taycan in a tax efficient way won’t automatically make that money available to reduce the tax burden on the 4 x £30k earners, it doesn’t work like that. It’s the wrong target.
I appreciate that it won’t automatically work like that. However if the overall tax take is too low what happens? Taxes rise. So over time society as a whole *is* impacted by this stuff.We should be encouraging cleaner air.
I would suggest that my previous proposal of limiting the value of vehicles where 2% BIK applies would achieve that in a way that was better value for the tax payer. You could even make it 1% on vehicles below x and 10% above or similar.
I am not against the concept of using legislation and tax breaks to promote cleaner air, just think it could be done in a better way.
m12nathan said:
SWoll said:
The counter argument would be that the poorest in society aren't subsiding anything, it's the high earners who are subsidising them with tax contributions that far outweigh what they take out of the system over the same period?
As an example 4 x £30k earners will pay a combined £20k in tax over a year. 1 x £120k earner will pay £45k in tax over the same period.
Is society better off letting the £120k earner buy a Taycan, or reducing the tax burden on the 4 £30k earners? Which has a more positive impact overall? Make it easier for them to heat their homes and feed their kids or add another car to the stable?As an example 4 x £30k earners will pay a combined £20k in tax over a year. 1 x £120k earner will pay £45k in tax over the same period.
No one is going to move to another country because they are expected to buy their own cars with post tax money, just nonsense.
You do realise that you could reduce the tax burden on your mythical £120k earning just on the cusp of leaving the UK because of tax group by not making them subsidise cars for a small percentage of their peers?
Let’s take it to an extreme. Do you think someone should be able to buy a Rimac via their company at $2.2m instead of buying it personally? If the intention of policy is to provide cleaner air does a Rimac purchase provide good value for the tax payer in terms of clean air v lost tax revenue?
You do realise that you could reduce the tax burden on your mythical £120k earning just on the cusp of leaving the UK because of tax group by not making them subsidise cars for a small percentage of their peers?
Let’s take it to an extreme. Do you think someone should be able to buy a Rimac via their company at $2.2m instead of buying it personally? If the intention of policy is to provide cleaner air does a Rimac purchase provide good value for the tax payer in terms of clean air v lost tax revenue?
Pflanzgarten said:
God forbid there’s any reward for working hard and being successful.
Some of the hardest working people are very successful in their careers but will never ever be able to afford a brand new taycanBut having said that they could save your life because of their hard work and success
It’s not so much that they will move, just that they will move the money to another tax efficient vehicle (in the Broadway sense.)
It’s not fair nor a good look but it’s real life. Making tax fair and also effective is very hard to achieve (probably impossible in fact, you can’t please everyone.) just look at how the recent pensions reforms aimed at senior doctors to help the NHS have had a massive collateral benefit to bankers and other high earners that most of the public wouldn’t want to reward better.
It’s not fair nor a good look but it’s real life. Making tax fair and also effective is very hard to achieve (probably impossible in fact, you can’t please everyone.) just look at how the recent pensions reforms aimed at senior doctors to help the NHS have had a massive collateral benefit to bankers and other high earners that most of the public wouldn’t want to reward better.
m12nathan said:
No one is going to move to another country because they are expected to buy their own cars with post tax money, just nonsense.
My point was that in the face of an increasing personal tax + corporation tax burden also suggesting that they are being subsidized by low earners is laughable. Keep taking away the benefits of earning that kind of money and people can, and are, buggering off as their ability to generate that kind of income is attractive to other economies.Who's going to pick up the tax shortfall then?
Earthdweller said:
Pflanzgarten said:
God forbid there’s any reward for working hard and being successful.
Some of the hardest working people are very successful in their careers but will never ever be able to afford a brand new taycanBut having said that they could save your life because of their hard work and success
Take away the whole EV/ICE or whatever power you want to think of, it boils down to this:
Some people have been massively incentivised to lease/pcp/purchase cars at a much higher price than they would ever have done so before
They will/have benefited massively on the cheap( almost free ) running of cars costing £120k and the manufacturers/dealers have had a bonanza
Problem is it’s like a Ponzi scheme as those that haven’t/can’t benefit from the incentives were never in the position to lease/buy/purchase a secondhand car for £100k
They were and are still in the position where they’d buy a 2 or 3 year old car for £20-40k but the supply of those cars has dried up and the people that were buying high depreciating company cars at around the £60k mark are now stepping out of £120k cars
And there is a vanishingly small market for four door saloons, two/three years old, that do 0–60 in a nanosecond, and have business miles on them for £90-100k regardless of whatever fuel they run on!
And that is a massive problem for Porsche ( and others ) and it’s only going to get worse, much worse
Some people have been massively incentivised to lease/pcp/purchase cars at a much higher price than they would ever have done so before
They will/have benefited massively on the cheap( almost free ) running of cars costing £120k and the manufacturers/dealers have had a bonanza
Problem is it’s like a Ponzi scheme as those that haven’t/can’t benefit from the incentives were never in the position to lease/buy/purchase a secondhand car for £100k
They were and are still in the position where they’d buy a 2 or 3 year old car for £20-40k but the supply of those cars has dried up and the people that were buying high depreciating company cars at around the £60k mark are now stepping out of £120k cars
And there is a vanishingly small market for four door saloons, two/three years old, that do 0–60 in a nanosecond, and have business miles on them for £90-100k regardless of whatever fuel they run on!
And that is a massive problem for Porsche ( and others ) and it’s only going to get worse, much worse
Edited by Earthdweller on Sunday 19th March 11:59
Soupdragon65 said:
But doesn’t it also create an incredible
opportunity for private buyers to pick up a lightly used Taycan at a good price?
Depends on your idea of a good price.opportunity for private buyers to pick up a lightly used Taycan at a good price?
If the market price is falling, then last month's 'good price' becomes a bad price.
It may just be that these things have to be viewed as A N Other EV, rather than as a Porsche.
Different depreciation profile, different attitude to used cars holding their value.
People are happy to pay big money for used IC Porsches, they are used to a world of Porsche ownership where you can buy a 3 year old one and not lose too much money on it. There's no reason for the Taycan to belong to that world rather than the world where most EVs depreciate like most other cars.
You could buy one at a 'bargain' price, lose £20k in a year and it's still an expensive car for the next buyer.
What is its intrinsic value?
There's a small market between people who will just buy a new one and people who can't afford £50k for a used car or don't want one that badly.
That small market is easily flooded.
m12nathan said:
No one is going to move to another country because they are expected to buy their own cars with post tax money, just nonsense.
You do realise that you could reduce the tax burden on your mythical £120k earning just on the cusp of leaving the UK because of tax group by not making them subsidise cars for a small percentage of their peers?
Let’s take it to an extreme. Do you think someone should be able to buy a Rimac via their company at $2.2m instead of buying it personally? If the intention of policy is to provide cleaner air does a Rimac purchase provide good value for the tax payer in terms of clean air v lost tax revenue?
You seem to make the mistake of assuming that the only alternative for that £120k is for the government to exercise its right to confiscate half of it.You do realise that you could reduce the tax burden on your mythical £120k earning just on the cusp of leaving the UK because of tax group by not making them subsidise cars for a small percentage of their peers?
Let’s take it to an extreme. Do you think someone should be able to buy a Rimac via their company at $2.2m instead of buying it personally? If the intention of policy is to provide cleaner air does a Rimac purchase provide good value for the tax payer in terms of clean air v lost tax revenue?
In many cases the government will not see much or any of that money. It can be contributed to pensions (even more so from April) or in the case of company owners it might just get left in the bank for a rainy day. It doesn't have to be distributed PAYE and taxed to death.
It's a strange world when you can spend your own earned income on a low tax company car along with £20k of VAT in the process, whilst enduring punitive tax rates in other areas, and still have the net beneficiaries of the glorious state sat there convinced its all at their expense.
m12nathan said:
theboss said:
still have the net beneficiaries of the glorious state sat there convinced its all at their expense.
Quite the assumption but you crack on.m12nathan said:
The poorest in society should not be subsidising the company owner buying a £160k car, getting 100% write down and then not paying BIK.
Edited by SWoll on Sunday 19th March 17:05
Pflanzgarten said:
God forbid there’s any reward for working hard and being successful.
Yup. It's quite clear, thread after thread, that we live in a country where someone generating wealth vastly above the wealth that the "average bloke" generates provokes intense hatred and jealously. It's almost like the culture here is that people feel content when everyone else around them is more miserable than they are.
Victim mindset, through and through.
Soupdragon65 said:
But doesn’t it also create an incredible
opportunity for private buyers to pick up a lightly used Taycan at a good price?
All I see are 3 year old cars at 80% list.opportunity for private buyers to pick up a lightly used Taycan at a good price?
Show me a 3 year old car at 50% list price (ignoring the vanity options the first owner felt they had to specify)
As others have mentioned, there's a huge market of buyers happy to spend £40k on a 3 year old car.
raspy said:
Yup. It's quite clear, thread after thread, that we live in a country where someone generating wealth vastly above the wealth that the "average bloke" generates provokes intense hatred and jealously.
It's almost like the culture here is that people feel content when everyone else around them is more miserable than they are.
Victim mindset, through and through.
If aimed at me then you haven’t understood my argument.It's almost like the culture here is that people feel content when everyone else around them is more miserable than they are.
Victim mindset, through and through.
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