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The mobility budget as seen by Athlon: 7 questions & answers

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On 28 February the federal mobility budget was passed by the parliament. Anyone working for a company that has signed up for this mobility budget will soon be able to combine a company car with other mobility options or allocate part of their budget to the rent for their house, under certain conditions. Which implications does this have for leased cars?

Since 2011, clients who spend their leasing budget through Athlon have been able to opt for products like Bikelease or FlexDrive in addition to the company car. “For several years now, we have been trying to offer access to alternative ways of commuting through the combination of various modes of transport”, Cécile Liénard, Senior Product Manager at Athlon, explains. “Needless to say, we are happy that this strategy has now been translated into federal law. The mobility budget will allow Athlon to further expand its service offer in the future.”

But what exactly does the mobility budget entail? Cécile Liénard answers sevens key questions.

  • Who is entitled to the mobility budget?

    Cecile Liénard: “The mobility budget is intended for employees who have a company car or are entitled to one. The choice depends on their personal situation. However, ‘company car’ does not refer to salary-based company cars, which are granted to employees in exchange for part of their salary. This arrangement comes with a set of conditions, for example a limited number of kilometres a year. It is still unclear whether employees who fall under this scheme will also be entitled to the mobility budget.”

  • What can employees spend their mobility budget on?

    Cecile Liénard: “If an employer applies for the mobility budget, their employees can opt in or opt out. However, the mobility budget is a very attractive package. Employees can choose to use part of their budget on alternative mobility solutions, like a bicycle or public transport, both for personal and professional use. It allows them to still have access to a modest company car, as well as an environmentally-friendly and affordable alternative for the entire family, since the journeys with alternative modes of transport are not taxed.”

    “Employees who live within a 5km radius of their workplace can also offset their budget against their rent or mortgage interest. If the mobility budget is not spent in full, the remainder is paid in cash, minus 38.07 per cent tax. With this in mind, the most attractive option tax-wise is to spend the full amount.” 

    “What makes the mobility budget so attractive are all those alternatives. The mobility compensation or ‘cash for car’ scheme does not offer that same flexibility. Moreover, the mobility budget focuses on green alternatives too. Once again, ‘cash for car’ does not: if you are paid a higher salary, you can also spend your money on a more polluting car.”

  • When can employees start using the mobility budget?

    Cécile Liénard: “We are currently awaiting the publication of the mobility budget in the Belgian official journal. That will not be easy, because of the complex management and all sorts of fiscal and social rules. In many companies, the car policy will have to be adapted and HR managers must prepare thoroughly for that.”

    "Even after the legal introduction of the mobility budget, many practical questions will remain unanswered. We expect that many employers will wait for a series of explanatory notes and circular letters before they will actually implement the mobility budget.”

  • Who will be the first to opt for the mobility budget?

    Cecile Liénard: “Younger employees who live in the city are more likely to use public transport or car-sharing schemes. Since they often live close to work, they can spend the mobility budget on their rent or mortgage interest. That allows them to save for the future.”

    “Families with more than one company car are another important target group. If they only use one of those cars regularly, they can exchange the other for an electric car or complement it with alternative mobility solutions.”

  • Will the number of company cars reduce?

    Cecile Liénard: “Time will tell. First we need to see how many employers will sign up for the mobility budget and how fast they do so. Moreover, employers can link their own conditions to the mobility budget. It is expected that the people who believe in it the most will be the first to go for alternative mobility solutions.”

    “Some employees will only be able to switch to the mobility budget once their current lease contract has expired. As a result, we will not see a major decrease in the number of company cars in the first few years. In the long term, however, we expect that a lot of employees will exchange their cars for a more environmentally-friendly model.”

    • What does the mobility budget entail for fleet managers?

    Cecile Liénard: “The implementation of the mobility budget is quite a complex matter. Athlon can assist fleet managers in the calculation of the total cost of ownership (TCO). Thanks to FlexDrive and Bikelease, we have the necessary experience to successfully implement the mobility budget within a company.”

    “There are already several tools on the market that clarify the philosophy behind the budget. However, as an expert in the subject, Athlon aims to thoroughly analyse all parameters first before launching a dedicated tool.”

  • Which cars may be included in the mobility budget?

    Cécile Liénard: “Of course an all-electric car qualifies for the mobility budget. If a car is fossil fuel powered, it may not emit more than 105 grams of CO2 per kilometer. In 2020 this limit will drop to 100 grams of CO2 per kilometer and in 2021 to 95 grams. Today, about 10 percent of the available models are eligible.”

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