Flagged-out trucks cannot be rented
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by Karen Miles International operators wishing to take advantage of lower tax rates by basing their vehicles outside the UK must own the vehicles if they want to put them on their UK Operator's Licences,
Earlier this week the Department of Transport said vehicles rented or leased abroad cannot be put en a UK licence. This follows last week's disclosure that a Portsmouth haulier is hoping to save around £5.000 per truck each year by hiring Spanish vehicles and placing them on his UK 0-licence (CM 25 Feb-3 Mar).
The DOT says European law prevents hauliers throughout the EU putting vehicles hired or leased from another member state on their domestic 0-licences. Cheaper foreign VED, or its equivalent, can be achieved with rented vehicles, but only by setting up a foreign 0-licence and placing those international vehicles on it, says the DOT.
"We will be pointing this out to the Traffic Area concerned but will leave them to take any necessary action," says a spokesman.
However, Ell law DOES allow international operators to place a truck bought abroad on their domestic 0-licences, he adds. The vehicles would need to registered abroad for ownership purposes—with some countries requiring proof of a resident business address—and would then be subject to that country's VED-equivalent rates.
The DOT spokesman says: "Buying vehicles is seen as part of the free trade allowed, whereas leasing and hiring are financial alternatives not automatically covered by the provisions of the Single Market."
A spokesperson for the Western Traffic Area. which is responsible for the Portsmouth operator. says discs have been issued to the haulier. but if the DOT rules otherwise the company will be advised. However, Colin Ward, transport consultant to the company, says: -I do not know the UK law that says hired vehicles cannot go on a UK licence."