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PRA welcomes cancellation of fuel duty increase

18 March, 2015

The PRA has welcomed the announcement in today’s Budget that the fuel duty increase which was scheduled for September has been cancelled.

Chancellor of the Exchequer George Osborne said this means there has been the longest fuel duty freeze in more than 20 years and as a result a driver saves around £10 every time they fill up their car.

PRA chairman Brian Madderson said: “We welcome the confirmation of the cancellation of the fuel duty increase. However, the PRA is one of a number of organisations that had been pressing for 2ppl reduction in fuel duty funded by the tax windfall on higher fuel volumes, so we are disappointed that the Chancellor has not taken this opportunity.”

Madderson said he also welcomed plans to radically review business rates. He said: “Independent petrol retailers are struggling to survive as fuel prices and margins shrink, and so the PRA welcomes the Government’s pledge in the 2015 Budget to overhaul both the level and methodology applying to business rates.”

Over 35% of these retailers have now developed symbol brand convenience stores on their forecourts to provide an income stream which supports low margin fuel, where more than 70% of the pump price is Government tax.

However, the current methodology employed by the Valuation Office Agency (VOA) is to assess forecourt stores for the rateable value on a turnover basis. In direct contrast their competition, local standalone convenience stores often owned by one of the “big four” supermarkets, is assessed on an area basis (ITSA). Thus a forecourt may have up to 4 or 5 times the level of rates to pay for the same business activity.

Madderson continued, “This is clearly an unfair and anti-competitive tax regime which must be tackled by this promised overhaul.

“We have already noted that the Northern Ireland Assembly has discarded its previous rates methodology for their 2015 Revaluation Scheme being implemented by Land & Property Services (L&PS). The new scheme includes balancing the methodology for standalone and forecourt stores to ensure that the many small often family owned and operated filling stations pay rates on the same basis.

“This is exactly why we are asking for Government to investigate when the review commences and the PRA will respond to all consultations.”

In other areas of the Budget, beer duty is being cut for the third year in a row with another penny coming off the pint. Cider duty comes down by 2%, as does the duty on Scotch whisky and other spirits, but wine duty was frozen.

The Chancellor also announced measures to relieve pressure on the North Sea oil industry, which has been hit hard by the fall in the value of oil.

However, commenting on the announcement which will increase tax on tobacco products, Daniel Torras, managing director of JTI in the UK, said: “The Government’s own figures show that tobacco smuggling has increased for the last two years, losing £2.1bn in revenue. With a ban on smaller packs of cigarettes and rolling tobacco on the horizon, along with plain packaging, now is not the time to increase tax on tobacco which will widen the price between legitimate and illegal products.”

Keywords: PRA, Budget, duty




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RegionDieselLPGSuper ULUL
East130.4761.40138.28126.22
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