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No fuel duty for small biofuel producers
Page 16
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The government is hoping its changes will stimulate the biofuels market. Roanna Avison reports.
SMALL BIODIESEL producers will no longer have to pay duty on their fuel, while mediumsized manufacturers will now pay quarterly rather than monthly. Under changes to the duty process which come into force on Saturday (30 June), only manufacturers producing more than 450,000 litres a year will not see any changes to the amount or way they pay duty.
An HMRC spokesman says: "With effect from 30 June, producers of biotuel of less than 2,500 litres annually will no longer need to pay any excise duty:Those producing up to 450,000 litres annually will only need to submit and pay returns quarterly.
"These changes have primarily been introduced to reduce the administrative burden on small and medium-sized biofuel producers. It will also allow businesses, or potential businesses,to explore the feasibility of biofuel production before being obliged to register and pay duty."
The government says it will consider the scope for raising the 2,500-litre threshold after a year.
There are currently about 1,400 biofuel producers in the UK,a large number of which produce it for personal consumption and they will be the ones who benefit most from the changes.
Charles Cornish, director at Evergreen Biodiesel, says the 2,500-litre limit will only affect those producing biofuel in their garages, and suggests that many of them will not have been paying duty anyway.
Evergreen produces about 400.000 litres of fuel a year and currently sends £10,000 to fI2,000 a month to HMRC; Cornish says being able to hang onto it until the end of the quarter would make abig difference to the firm's cash flow.
Paul Mugleston, office manager at Biosave. says the changes will help with cash flow, but adds: "We're not far away from the 450,000 threshold so it will only benefit us for a couple of months:"