After four years at the helm of the Petrol Retailers Association, it is good to be able to pen a more positive note at the start of 2014.
Retailers may have forgotten that despite PRA’s late intervention, cutting back the overall liability by around 14% for forecourt properties in England, Wales and Scotland, the average increase at the 2010 Revaluation was still over 60% according to a report by ratings specialists, MUA Property Services. Thus it was a real achievement by PRA that HM Treasury agreed the £1,000 rates discount, announced by the Chancellor in his Autumn Statement, would be applicable to petrol filling stations with a rateable value of £50,000 or less.
Now we are preparing a submission to Department for Communities and Local Government’s ’Consultation’ which will highlight the disparity between assessments on forecourt convenience stores versus standalone convenience stores.
Fuel duty has been a major financial burden for retailers. Together with 20% VAT, government tax accounts for over 60% of the cost of a tanker-load of fuel. Independents are forced to provide bank guarantees and/or liens on property to their suppliers (often in excess of actual needs), and arrange bank overdrafts and/or loans to cope with the cash flow demands involved.
Thus it is a great prospect that the Excise Payment and Security System (EPSS) will enable retailers to apply for Deferment Account Number (DAN) through HM Revenue and Customs and buy their fuel on a duty-deferred basis with nil security provided the supplying terminal is a tax warehouse.
PRA is lobbying government to re-examine the entire tax warehouse system as it is hampering the smooth running of UK businesses in the oils sector. This was partly highlighted in the Purvin & Gertz report for Department of Energy & Climate Change/UKPIA in March 2013.
Finally, many retailers are excited at the prospect of Shell re-entering the dealer market with new initiatives that were featured in their recent Retailer Conference at the Celtic Manor Resort Hotel in Wales.
This will provide a wider range of strong, competing brands for the future, which is not yet rosy but certainly looking better for independents.