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AfMA Says Fleets and Road Safety Could Suffer Due to Proposed FBT Changes

August 21, 2013

The Australasian Fleet Management Association (AfMA) reported that its members would be adversely affected if the proposed changes to the fringe benefits tax (FBT) rules take effect. The association conducted a series of forums in the country’s major state capitals during August to discuss the proposed FBT changes. AfMA said its sample group manages more than 126,000 vehicles.

AfMA’s survey found that 90 percent of respondents said the proposed FBT changes would adversely affect their organization financially, operationally, and/or administratively. Next, 61 percent of the survey group currently uses the Statutory Method for part or all of their fleet FBT calculations. The study also found that 41 percent of respondents’ vehicles would adversely be affected by the proposed FBT changes, with a $3,300 FBT increase cost, per vehicle per year.

Other study findings include 49 percent of the group intending to reduce the number of vehicles they operate, and 37 percent of respondents saying they intend to look at employee car allowances.

AfMA’s survey methodology focused exclusively on passenger and light commercial fleets and excluded salary packaged novated leases. The association said these new results show the wider ramifications of the proposed FBT changes.

To emphasize the effect the changes could have in the Australian marketplace, AfMA noted that 50 percent of all vehicle purchases in the country are made by fleets, helping drive the market for fuel-efficient and safe vehicles. The association added that this change will encourage the use of grey fleet (employee-owned) vehicles for business purposes, which AfMA stated will increase a given organization’s Occupational Health and Safety risk.

Beyond the changes adversely affecting fleets, AfMA said it’s likely the government won’t see increased revenue from the FBT change, based on the survey’s findings.

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