Chancellor Gordon Brown has broken faith with the freight industry by increasing diesel duty by 1.25 pence a litre, the Freight Transport Association has warned.
Chief economist Simon Chapman said: “The chancellor is on record as saying that the logistics sector is a vital part of delivering future economic success. Yet his decision today suggests he sees the industry as no more than a source of tax revenue that he can plunder with impunity.”
The move will increase industry’s costs by £170 million.
The FTA said: “During 2005 the independent Burns Inquiry into the effects of fuel taxation and foreign competition found that the costs of road freight transport in the UK are out of step with the rest of Europe. The main cause of this problem is the level of UK diesel duty which, at 47p per litre, is more than double the EU average rate of 22 pence per litre.
“In the light of this work, the Chancellor commissioned a joint Government/industry task group to validate the Burns Inquiry data set and work towards a shared understanding of the problems that the haulage industry faces. The report of the Haulage Industry Task Group is published today.
“While the Treasury’s own officials now concede that the scale of the problem identified by the Burns Inquiry is correct, the Chancellor has chosen to walk away from taking action.”