Heavy Fuels and the Law
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An Answer to Oft-repeated Queries as to the Use of Vaporizing Devices and Its Effect on Fuel Tax and Vehicle Licence Duty
S0 many inquiries have lately reached this office from hauliers and others who are in doubt as to the legal position in regard to the mixing of light and heavy oils and the taxation, payable on vehicles having petrol engines in which heavy oils are used as fuel, that it has been decided to state the case clearly in a short article.
To make the matter quite plain, it will be as well briefly to summarize the steps that have led up to the present position in regard to the duty on hydrocarbon oils. By the Finance Act of 1928, Section 2, a duty of 4d. per gallon on light oils was imposed, and this took the form, not of an excise duty, but of a customs duty, charged on all oils entering the coantry. Provision was included for a rebate at the same rate (4d. per gallon) on all heavy oils, so that, in effect, the duty was charged only on light oils, and the specification of light oils was framed so as to aim particularly at petrol. It is as follows :—
"Hydrocarbon oils, of which not less than 50 per cent. by volume distils at a temperature not exceeding 185 degrees C., or of which not less than 95 per cent, by volume distils at a temperature not exceeding 240 degrees C., or which gives off an inflammable vapour at a temperature of less than 22.8 degrees C. when tested in the manner prescribed by the Acts relating to petroleum."
It may be taken that hydrocarbon oils other than light oils normally include paraffin, kerosene, gas oil, vaporizing oil or power kerosene, Diesel oils, switch and transformer oils, medicinal paraffin, fluxing oil, mineral lubricating oils, fuel oils, coal tar and tar oils.
By the Finance Act of 1931 the rate of this duty was raised to 6d. per gall. For some time previously it was noticed that some oil suppliers were producing motor spirits which included an admixture of so-called heavy oils, paraffin, etc., on which, of course, the whole duty was rebated. In case this practice should develop to a large extent legislation was introduced to make it illegal to mix light and heavy' Oils,
The clause having this effect was opportunely incorporated in the Finance (No. 2) Act, 1931, which, it
will be remembered, was introduced at the time of the national emergency and which increased the rate of duty from 6d. to 8d. per gallon. The date of this Act was October 5, 1931, and the section prohibiting mixing was Section 4, which in part reads as follows :—
" (1) It shall not be lawful for any person to mix any hydrocarbon oils in respect of which a rebate of
duty has been allowed under Sub-section (3) of Section 2 of the Finance Act, 1928, with any light oils within the meaning of the said sub-section, unless he is acting under the authority of a licence granted by the Commissioners of Customs and Excise, and has, before the mixing, paid the duty which would have been paid if the rebate had not been allowed.
" (2) If any person in contravention of this section mixes any such hydrocarbon oils as aforesaid with any light oils he shall be liable at the option of the Commissioners of Customs and Excise either to a Customs penalty equal to three times the value of the oils mixed, including any duty chargeable thereon, or to a Customs penalty of £100. and the mixture shall be forfeited."
When the section was framed the petroil system of lubricating certain motorcycle engines, in which a proportion of the lubricating oil is poured into the petrol tank, was not contemplated, otherwise an exception clause would probably have been included, as it was never intended to put a stop to this.
Again, in the manufacture of certain paints and cutting oils used for lathes and other machine work sometimes heavy and light oils are mixed, and it may be taken that the Customs authorities do not propose to interfere with such practices. They do, however, aim at getting the full rate of 8d. tax on any mixture of light and heavy oils used as a motor fuel, whether sold or mixed privately. Several prosecutions have resulted in heavy penalties.
• The Finance Act, 1933, has reduced the rebate on heavy oils from the full 8d. to 7d., which, in effect, puts a tax of 1d. per gallon on heavy oils. The object of this revision was to help the coal industry, and it was not aimed only at road transport.
Now arises the important question as to whether petrol-engined vehicles on which some kind of vaporizing device is fitted, with a change-over arrangement which permits the engine to be warmed up on petrol and thereafter to run on a heavy oil, are permissible.
Any such device in which the petrol and the heavy oil are mixed is illegal under Section 4 of the Finance '(No. 2) Act, 1931. On the other hand, any such device employ ing two carburetters or a carburetter with two float chambers, so that the two fuels do not mix while in liquid form, does not infringe this Section. Whether a device in which two jets spray petrol and heavy oil in an induction pipe would be taken to infringe the law or not depends on a nicety of legal meaning, and the argument would probably turn on whether the two fuels were mixed in a liquid or a gaseous state, the former being illegal.
Another question which one often hears is whether a vehicle that has such a vaporizing device will pay, from January 1, 1934, the lower rate of licence duty scheduled for "vehicles using as fuel light oils," or the higher 'rate which has for the first time been introduced for "other vehicles," which is really meant to cover compression-ignition oil-engined vehicles. The two goods vehicle scales appear on this page.
The answer is that vehicles having vaporizing devices and using heavy oils should pay the higher tax. It then evolves into a question of whether the money saved per annum by using the cheaper fuel (on which the tax is id. instead of 8d. per gallon is sufficient to counterbalance the additional tax, the additional cost of the vaporizer and any incidental extras. The mileage per annum is an important factor.