Fuel duty increase – ‘just scrap it’ say industry’s lorry operators

The Freight Transport Association says that the Chancellor’s proposed 2p per litre fuel duty increase planned for October must be scrapped with immediate effect. FTA Director of Policy James Hookham said, ‘The horrendous rise in the world price of oil has imposed a daily increase in the price of diesel, and thus the cost of freight transport. The toxic combination of high world oil prices combined with the UK’s self-inflicted high fuel duty regime constitutes a serious problem for every company in the country. Inevitably that problem has to be passed on to all of their customers, whether commercial or private consumers. High fuel duty contributes to inflation.

‘After everything that has happened, the Chancellor cannot seriously be thinking about adding to the fuel price burden by increasing the duty level. He must recognise the extent of this emergency right now. As a signal of understanding and goodwill, he should announce the scrapping of the 2p increase immediately. He should also say that he will engage in talks with the industry aimed at producing early financial relief to transport operators in the form of a duty rebate, and a longer term change of the system to reduce the excessive tax take from essential vehicle users.’

FTA, which represents companies operating over 220,000 lorries, almost half the national fleet, says that the bulk price of diesel has risen from 76p per litre 12 months ago to 106p per litre today, an increase of 40 per cent. Hookham said, ‘Almost everything that we use or consume every day is the product of a lorry journey fuelled by diesel. The cost of those journeys continues to rise at a frightening rate. Sadly, at 50p per litre, the highest duty rate in Europe, the Chancellor takes a disproportionately high cut of that cost – far too much. In the light of the new world order of oil prices the Government must recognise that such penal duties on the transport industry can no longer continue and that the whole process of taxing lorry operations must be reassessed.’

FTA says that the problems for UK transport are increased by the large numbers of foreign vehicles coming into the country fuelled by cheaper continental diesel. Hookham said, ‘Foreign hauliers working in the UK do so at a lower cost than can be achieved by UK operators. We were very disappointed and surprised by the Government’s recent decision not to introduce a charge on foreign vehicles using UK roads. That decision needs to be reconsidered. It is a farce that high fuel duty in the UK and free entry to foreign vehicles means that our domestic transport industry cannot compete on level terms with overseas competitors.’