FTA offers fuel duty remedy

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The transport industry “desperately” needs support says the FTA and although the government cannot deliver lower oil prices it could half fuel duty at a cost of around £380 million per year to the exchequer.

According to research carried out by PricewaterhouseCoopers (PwC) the cost of operating an HGV in the UK is approximately ten per cent higher than in other parts of the EU.

Fuel duty in the UK is 50.35 pence per litre, compared to an average of 24.97 pence per litre across the rest of Europe.

PwC has suggested a rebate of 25 pence per litre should be provided to operators of vehicles of more than 38 tonnes in the UK in order to balance this out.

While this would reduce government income from £1 billion to £413 million per year, PwC has calculated the rebate would provide an extra £200 million from increased corporation tax, business growth generating more taxation, new fuel purchases by foreign operators working in the UK and increased employment.

James Hookham, director of policy at FTA, said: “The industry is clearly suffering from the massive increases in the price of diesel while the UK operates the highest levels of duty in the whole of Europe.

“And with the EU about to remove the present limits on foreign lorries working in the UK, now is the hour for the government to deliver some practical steps to support the industry.”

The FTA has submitted the PwC proposals to the chancellor and the prime minister.

* The FTA has published the 2008 edition of its International Road Transport Guide, which this year contains more details of local ferry routes and fines for non-compliance with local regulations.

The guide covers the operation of goods vehicles in more than 50 countries throughout Europe and the Middle East.

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