UK growth and competitiveness can ill-afford further increases in diesel duty, which is already by far the highest in the EU. That is the message from the Road Haulage Association, ahead of tomorrow’s road fuel price debate in the House of Commons.
“Road diesel is a key industrial fuel, affecting the price of almost everything we make and buy. It already amounts to a 30% tax on this element of the supply chain – far more than in any other EU country,” says RHA Chief Executive Geoff Dunning.
“A typical UK 44-tonne truck – the workhorse of the British economy – pays at least £25,000 a year in diesel duty. That compares with £16,000 in France, £15,000 in Belgium and just £12,000 in Luxemburg, where many foreign fleets buy their fuel.
“British transport firms must pass on their costs to British customers – or lose the work to foreign competition, in which case the UK government gets no duty or other tax revenue.
“We are now faced with the prospect of two substantial duty increases – 3.02 pence a litre in January and then another increase in August that is likely to be around 3.41 pence a litre – a total increase of 6.63 pence. That would be an 11% increase over just eight months.
“Taken together, these increases would widen the gap between what UK industry pays for transport and what its EU competitors pay by another £2,700 per truck per year.
“These duty increases are totally out of step with UK business. The transport industry’s customers are looking for rates freezes and even reductions – not the increases that will have to be sought as a result of diesel duty increases”. Dunning.