The PRA has welcomed the decision by HM Revenue & Customs (HMRC), reported by Forecourt Trader last week, to consult on changes to its current practice regarding duty on petrol derived from vapour recovery.
PRA chairman Brian Madderson said: “It is positive to see that following continued persistence from the PRA, HMRC has published a consultation document regarding the reimbursement of duty on petrol subject to vapour recovery.”
He said the PRA had been trying to resolve the issue for many years, because it was clear that the scheme had no legal basis and caused substantive loss to independent retailers.
He added: “The lack of any legal basis for the vapour recovery reimbursement scheme and the damage caused to petrol retailers has been brought to the attention of successive Treasury ministers and to the chief executive of HMRC by the PRA.
“With this consultation, HMRC has finally acknowledged the problems inherent in the scheme from its inception over 20 years ago. It is now consulting with interested industry groups as to whether and/or how to implement a legal mechanism to deal with duty on petrol subject to vapour recovery.
“It also highlights the deficiencies of the present delivery system, where retailers are always likely to be short delivered in their petrol loads, because heavily saturated vapour is captured as part of the process. The supplier always has the benefit of the captured product to sell again and at Duty Point Terminals, it gets the duty back from HMRC too.
“The PRA will evaluate the consultation document and consider what should be done to correct the current situation, so that retailers are no longer disadvantaged.”