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a good !deafer hauliers to step back now and again, and take a cool look at relevant issues in depth. Thanks to our colleagues at Tolley Publishing, we'll be doing just that every month with this bulletin. We feel the title says it all... • The high cost of diesel in the UK compared with current continental pump prices is a source of concern and anger to British truck operators, with fresh warnings emerging only a couple of weeks ago about the devastating effects further increases will have (CM 18-24 Feb).
The Road Haulage Association, for its part, has mounted a vigorous 'Fair Play on Fuel" campaign designed to focus Government attention on the iniquity of its annual hike in fuel duty-5.5p/lit was added by the 1998 Budget, increasing duty to 44.99p/lit, making Britain's current diesel duty rate the highest in Europe.
Average diesel fuel prices throughout the EU amount to only about 65% of UK current pump prices, so it's no wonder UK hauliers feel bitter at being priced out of contention on international contracts and even out of their own domestic market by continental hauliers who can operate here on cheap diesel while still benefiting from lower vehicle excise duty (VED) in their countries.
With fuel comprising up to 36% of total vehicle operating costs, hauliers can hardly be blamed for seeking ways to cut their diesel budgets. Nationally the RHA is pressing the Government to adopt its Essential User Rebate scheme to align UK diesel prices with the EU average, but many hauliers are importing cheap foreign fuel; either by the vehicle tankful or in more substantial quantities. Some even chance their arm by using rebated fuel (or "red diesel") which is prohibited for normal road-going haulage vehides.
What is legal and what is not? Hauliers running road vehides on red diesel, or the Irish equivalent green rebated diesel (not to be confused with low-sulphur "green diesel"), are committing an offence and risk substantial penalties if caught by Customs and Excise (C&E). The same applies to international hauliers carrying red or green diesel in auxiliary/belly tanks for use outside the UK (except for legal use in powering fridge motors and other ancillary plant). Prosecution and conviction usually result in a fine of 25o per offence (meaning each individual journey during which the fuel was used); payment of back duty; and, in some cases, impounding of the vehicle (Lim vehicles were seized in 1997). And hindering C&E officers in their investigations can result in a two-year prison sentence for the offender on top of any other penalty.
Fuel tanks
The law (contained in EC Directive 92/81 arid the Traveller's Reliefs [Fuel and Lubricants] Order 1995) allows hauliers to return to the UK with "standard" fuel tanks filled to the brim with low-cost continental diesel. Standard tanks, according to C&E, are only those fitted by the vehicle manufacturer. However, debate arises as to what is a "standard" tank where, prior to its initial use, a vehicle is converted for a particular purpose and larger capacity fuel tanks are added as part of this conversion.
While C&E is prepared to view such a conversion as being "original manufacture", it would certainly not approve of fitting tanks with a capacity greater than 1,500 litres.
Operators bringing into the UK amounts of diesel beyond the capacity of the vehicle's standard tanks can expect to be charged duty on the excess at the current UK diesel fuel duty rate of 44.99p/lit. But depending on the degree of co-operation given (or not) to C&E investigating officers, the extra duty charged could be doubled and criminal charges could be brought.
Where there are obvious attempts to conceal the import of excess fuel, this would be viewed as a criminal matter, probably resulting in seizure of the vehicle. Similarly, if C&E were to find a UK operator taking a tractive unit across the Channel merely to feed cheap continental diesel fuel into his UK vehicle fleet this would also be a criminal issue, again most likely resulting in seizure of the vehide as well as other penalties.
As a spokesman points out, C&E has extensive statutory powers under the Customs and Excise Management Act 1979 and various finance acts to impose a wide range of penalties.
And in a curious footnote, one diesel-fuel story currently circulating is of a haulier threatening to sack any of his drivers who return to the UK without topping up his tanks to the limit with cheap diesel.
• by David Lowe