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The call of duty
Page 22
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The UK road transport industry runs on the most expensive fuel in Europe and foreign competitors are quick to take advantage. Roanna Avison assesses the chances of help from the Chancellor.
IFuel duty is an emotive subject, particularly in the UK, where we pay more than in any other European nation.
A look at pre-tax fuel prices in Europe reveals that the UK is one of the cheapest sources of fuel (see table) it's the Chancellor's take that puts us at the top of the price league. And the proposed 2p/lit increase to fuel duty in October will be another blow to British operators already facing stiff competition from foreign operators able to buy cheap fuel before they conic to the UK.
As a result, the Road I laulage Association (RHA) has written to the Treasury, calling on it to reduce duty for the haulage industry (CM 13 September, 'RNA calls on Treasury to cut fuel tax for hauliers').The RHA points out that a UK haulier running a 44-tonner pays up to f15,(X)0 a year more in fuel duty than any foreign competitor and that fuel prices have already risen 6% this year, adding 2% to operating costs.
Strong feelings
The cost of fuel and the impact it has on operator's bottom lines is arousing such strong feelings that Transaction, which organised the fuel protests in 2000, has reformed and is planning another protest.
RHA policy director Jack Semple says: In 2001 the Chancellor accepted the tax level for trucks was too high and tried to address it with the failed Lorry Road User Charge. That didn't work, so we really need to decouple haulage from the green tax being placed on cars."
He adds that an increasing number of foreign-registered trucks coming into the UK are available for domestic work and UK hauliers face a huge tax cost in comparison.
Fuel duty rebates
Semple points out that five EU states the Netherlands, Belgium, France, Spain and Italy also offer hauliers a fuel duty rebate: the RHA wants the government to set up something similar in the UK. -This is one of the measures available to the government and it must recognise that something has to be done to keep UK hauliers competitive," Semple adds.
Adam Leonard, MD of The Pallet Network (TPN), says all the network's members are feeling the pain of the UK's high fuel costs, but he accepts it is hard to make people in authority understand what it really means for hauliers: "Until there are no deliveries and there's no bread on the shelves it will be very difficult to convince those in power to recognise that transport in the UK is the jewel in the crown and everything else revolves around it. It feeds everything that happens in the UK."
He confirms that TPN members face tough competition from foreign operators able to buy cheap fuel, but warns that the transport industry is treated with such disdain in the UK that any quick relief is unlikely.
A spokesman from the UK Petroleum Industry Association says the organisation would be in favour of some kind of rebate system for hauliers, rather than a scheme involving different grades of fuel for professional users. But he adds: "1 guess any duly or VAT rebate would create a lot more administrative work for HM Revenue and Customs."
Industry engagement
A Treasury spokesman would only say:"The government continues to engage with the industry, and the Freight Data Feasibility Study is expected to report back shortly, in time for the Pre-Budget Report. In the Budget, the then Chancellor set out the government's policy on fuel duty and this remains unchanged." •