The Freight Transport Association (FTA) has written to the Chancellor of the Exchequer ahead of his 2014 Autumn Statement on 3 December, outlining the economic benefits that could be delivered by a reduction in fuel duty and calling for a cut of 3ppl.
In its letter to George Osborne, FTA highlighted how fuel accounts for nearly 40% of the cost of running a 44-tonne truck and that it had risen dramatically over the past 20 years. The Association told the Chancellor that it estimated that just a one penny increase in fuel duty would add approximately £480 a year to the cost of running a lorry.
FTA director of politics Karen Dee said: “FTA welcomed the Chancellor’s confirmation in the 2013 Autumn Statement of his intention to freeze fuel duty for the rest of this Parliament. However, we believe that the Government should go further and cut fuel duties by 3ppl with commensurate reductions in duty for gas oil, in order to stimulate consumer spending and business investment and re-ignite economic growth.”
Dee added: “The current rate of fuel duty costs industry around £6.74bn a year. In a marketplace with ever-shrinking borders between countries, fuel duty is also a barrier to fair competition across Europe; the UK diesel duty rate is 24ppl higher than the average rate across the EU. Profit margins within the freight industry remain tight, and therefore, costs increases must be passed on to customers and ultimately to consumers.”
The FTA submission also raised the need for the Chancellor to ensure that the Roads Investment Strategy provides sufficient funding to deliver the full approved programme of road improvements, adding the Treasury must ensure that both the Highways Agency’s and local authorities’ revenue budgets are increased to allow for improved maintenance of existing roads.