AT THE HEART OF THE ROAD TRANSPORT INDUSTRY.

Call our Sales Team on 0208 912 2120

...so will fuel tax fall?

6th December 2001
Page 11
Page 11, 6th December 2001 — ...so will fuel tax fall?
Close
Noticed an error?
If you've noticed an error in this article please click here to report it so we can fix it.

Which of the following most accurately describes the problem?

• by Mike Gordan So finally it seems that foreign hauliers are to pay their way for using UK roads. The trouble is that so are British hauliers. So are you convinced by Paul Boateng that the government will further address UK haulage taxes to offset the costs of such a vignette systemP The Road Haulage Association is convinced that the only way for the government to go is to reduce fuel duty for hauliers: a return to the idea of an essential-user-rebate. FiHA policy director Karen Dee says that because the UK's level of vehicle exercise duty is already very close to the EU minimum, the government will have to look at fuel duty.

Boateng says the UK's VED is already "among the lowest in Europe", and Dee warns: "The UK will not be able to reduce VED by very much before it reaches the EU's minimum level, and then other forms of tax will have to be considered. We believe this will lead to concessions on fuel duty. The government will not reduce fuel duty across the board, and so the most likely source will be the essential-user rebate. It is difficult to see an alternative, but this is something we want to address with the government."

She also believes that the government will opt for the time-based scheme as opposed to a distance-based system, which would require complex satellite track and trace technology: "The time-based scheme is the most practical. This will only take two years to implement after Parliamentary approval, which is not attainable before 2003. The distance-based scheme would take four years," Either way, the vignette will not be implemented before 2005.

Richard Turner, chief executive of the Freight Transport Association believes the government is sincere in its intention to reduce the tax burden. However, he warns that the initiative could overlap with the growing pressure to apply congestion charges as a way of managing demand for road space.

"Adoption of such a scheme, fitment of onboard signaling equipment and the creation of electronic monitoring infrastructure would create a soft means of introducing motorway tolling, city congestion charging, and much more," he says, "We must be careful to get the approach right now."

A spokeswoman for the Treasury was unable to comment on which taxes would be reduced, or indeed whether the concessions would be announced in the Chancellor's next Budget in March 2002.

II The consultation ends on B February 2002.


comments powered by Disqus