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Taxes are taking their toll
Page 68
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Ray Dickson, MD of F Dickson
Transport in Croydon, has strong views about the taxes we pay and the rates we try to survive on...
Iwas being taxed by taxes the other day, so to speak. In fact I was pondering the fact that when Prime Minister Robert Peel introduced Income Tax in June 1841 at one penny in the pound, he had no idea what a monster he was creating.
Some 160 years later. any beleaguered haulage contractor who calculated the percentage of gross turnover paid to the Exchequer would doubtless turn pale in disbelieLA recent column in the Daily Mail nearly ruined our breakfasts by informing readers that they are paying 50% of their gross incomes in a mixture of direct and indirect taxation. For the haulage industry things are just as bad, perhaps even worse. For starters, the Exchequer takes about 25-30% in tax and national insurance from their employees, then seizes another 12.8% in the form of employers' national insurance.
The government rakes in another 17.5% in VAT on everything we purchase — and then takes another 17.5% on everything we sell.
Diesel prices are, as we all know only too well, spiralling out of control, and despite the benevolence of the Chancellor in delaying a duty increase of almost 2p/lit he is laughing on both of his faces, because he still scoops up increased duty through VAT on higher prices at the pump.
Never mind.., if we find that despite the Chancellor's best efforts we make a small profit at the end of the financial year,he will be only too pleased to relieve us of some Corporation Tax.
All of which begs the question, when is the haulage industry going to start charging the rates it should be charging?
According to latest figures from haulage industry analysts Plimsoll, about 25% of all haulage companies are overtrading at non-profitable rates in an effort to retain sales.This is frightening, as the Freight Transport Association reports that it now costs more than £100,000 a year to operate a 44tonner.A shortage of drivers and the imminent arrival of the WTD can only lead to a sharp increase in the ratio of wages to turnover.
Meanwhile, some cowboy operators are undercutting rates to attract new customers. leaving the established haulier to cut his already down-to-the-bone rates or lose the customer he has served faithfully for years.
Once upon a time there was a thing called goodwill in our industry, when a haulier was assumed to "possess" a customer. Nowadays it is often based on the whim of a transport manager within a company.You may have a great relationship with him;he may come to you with most or all of his transport requirements. All is well until he suddenly leaves and the haulier has to start from scratch.
Heaven forbid that the new transport manager has a "friend" in the haulage industry or who can be tapped up by a competitor. Suddenly the vehicles and staff you have invested in so heavily are at risk.
It is high time the haulage industry stopped being afraid of itself and we all started to charge the right prices for the job and stopped settling for a 2-3% profit on a good year.
Over the past two years too many haulage companies have gone to the wall. Surely it is time to make sure you and! don't join the dole queue for old hauliers... we work damned hard; we should expect better rewards.