‘Halve fuel duty for transport firms’ urges FPB

The government needs to do more than just freezing the rise in fuel duty if it wants to ease financial pressures on small businesses, a business lobby group has said.

The Forum of Private Business (FPB) said while the freeze on the 2p fuel duty, announced by the government yesterday, is a welcome first step, it must go further and halve duty for some businesses.

Research commissioned by the Freight Transport Authority (FTA) into the impact on government revenue of decoupling diesel duty on heavy lorries found a rebate of 25p per litre could boost government coffers by some £200m a year.

Income would be generated by increased corporation tax take, business growth, new fuel purchases by foreign operators working in the UK, and increased employment leading to higher income tax and national insurance receipts, the group said.

James Hookham, policy director at the FTA, said the transport industry is suffering from the fuel price increases.

“The UK operates the highest levels of duty in the whole of Europe, now is the hour for the government to deliver some practical steps to support the industry,” he said.

“After the 2000 fuel crisis, Gordon Brown promised to consider the way in which transport is taxed. Eight year later we have seen no progress.”

“The new proposals offer practical and relatively economic means of real assistance for our vital industry at such a difficult time. The government must address these problems,” he added.

© Crimson Business Ltd. 2008