Saturday 22nd Oct 2016 - Logistics Manager

Lorry charge scheme becomes law

The government scheme to charge foreign lorries for using UK roads has become law opening the way for charges to be levied from April next year.

Under the HGV Road User Levy Act, vehicles will pay up to £10 a day, or £1,000 a year to use UK roads.

The scheme will apply to all commercial vehicles over 12 tonnes. UK operators will pay the charge but be compensated through a reduction in vehicle excise duty.

UK hauliers will pay an annual or a six monthly charge for each lorry at the same time and in the same transaction as they pay its Vehicle Excise Duty. Foreign hauliers can pay daily, weekly, monthly or annual charges. Non-payment of the charge will be a criminal offence, which could result in a fine of up to £5,000.

Roads Minister Stephen Hammond said: “This new act will help the UK logistics industry remain competitive by making sure that operators from abroad are paying towards the cost of building and maintaining the UK’s roads as well as creating a level playing field for domestic operators.”

The charge bands are aligned with existing VED bands. Daily rates range from £1.70 for a vehicle in VED band A to £10 for a vehicle in VED bands E, F and G.

Annual rates range from £85 for a Band A vehicle to £1,000 for a vehicle in VED band G.

The Freight Transport Association welcomed the move. However, James Hookham, FTA’s managing director of policy & communications pointed out: “There were important conditions attached to our support to avoid additional costs and burdens falling on UK operators, as the charge could not be applied to foreign vehicles alone, and, so far, these have been met.

“The next key event is the chancellor’s budget statement on 20 March when the new reduced vehicle excise duty rates will be announced.  We will be watching to make sure that UK operators are not disadvantaged.”