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Tax the Chancellor
Page 49
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DURING the next three months the Chancellor of the Exchequer will be bombarded by representations by trade organizations for special consideration in the Budget. None will plead with greater conviction and justification than the road transport associations. The case for the reduction of fuel tax is so obvious and well known that it should no longer require repetition, but the sorry fact is that it, has been consistently ignored by successive Chancellors and must be stated and restated ad nauseam. Eventually its validity must be accepted, but until that day comes there can be no respite in the pressure exerted on the Government for an equitable rate of duty.
Fuel tax is, however, not the only ground for complaint against the fiscal policy imposed on road transport. In last year's Budget the Excise duty on public service vehicles was reduced by about two-thirds, but the scale levied on goods vehicles is still both excessive and anomalous. It is difficult to understand why Excise duty on public service vehicles should be based on payload, whereas the annual tax on goods vehicles is calculated on unladen weight. There seems to be no logical reason ' for this difference.
. Payload is obviously the correct basis for taxation on all commercial vehicles. It equates the duty more nearly with the use made of the vehicle and does not encourage the employment of light vehicles for loads beyond their reasonable capacity. It combines justice with the promotion of road safety.
The present system operates particularly unfairly in the case of some specialized vehicles. A correspondent in this issue draws attention to the anomaly by which a vehicle built to carry a load of hydrogen weighing approximately 2,1 cwt. is taxed at an annual rate of £450, whereas a normal 24-ton-gross vehicle hauling a payload of about 16 tons pays no more than £130 a year. The reason is solely that the nature of the gas load is such that a vehicle weighing unladen almost the maximum gross figure of 24 tons is required.
This is, of course, an extreme case, and it would not be reasonable to place such a vehicle on the same footing, for taxation purposes, as a light van with a payload capacity of 5 cwt. Nevertheless, it emphasizes an anomaly which exists in the present system of taxation, and is reproduced on a lesser scale in connection with other specialized vehicles which are necessarily heavier than the average. A new method of computation and a lower scale of tax are required.