Chambers of Commerce, road hauliers and other business members from around the country have collectively written an open letter to the Chancellor, urging him to scrap the proposed increase in fuel duty, scheduled for April.
The Government has controversially planned an increase of 2p per litre on fuel duty, which Chambers of Commerce members, especially hauliers and road dependent businesses claim is, "completely unwarranted" and could cost the haulage industry an estimated £170 million.*
The letter states that the impact of the decision will severely damage the UK's haulage industry, which is already battling against the staggeringly high price of oil and a duty rise from last October. It goes on to say that in order to remain competitive, Chambers of Commerce and their business members would welcome the opportunity of working with Government in developing "an alternative pricing system which separates the way fuel tax is levied for cars as opposed to commercial vehicles."Commenting on the planned increase, David Frost, Director General of the British Chambers of Commerce said:
"The message being sent from Government to our logistics industry is particularly worrying. The ability for hauliers to compete with other European firms is looking increasingly threatened, especially considering the UK economy faces a slow down in 2008. The Government must urgently reconsider this unnecessary rise in fuel tax to protect hauliers and businesses who use the roads on a daily basis."
Hertfordshire Chamber of Commerce & Industry, Chief Executive, Tim Hutchings said,” We have received an enormous response to this issue. The cost of fuel has risen dramatically in recent months, it is impacting on businesses of all kinds. Whilst the fuel companies and the government might be enjoying additional revenues most businesses and their customers are feeling the pinch. Adding an additional 2p in April amounts to institutional greed”.
Hauliers have calculated that April's tax hike, which looks set to be followed by yet another in 2009, would add an extra £15,000 in costs per vehicle per 100,000 miles on the road.*
The full text of the letter is below:
We the undersigned are calling on the Government to reconsider the 2p increase on fuel duty due to come into effect in April. This rise will have a particularly damaging impact on our members in the haulage industry.
With the price of oil hovering around the $100 dollar barrel mark, British hauliers are finding it increasingly difficult to compete with their European competitors due to the high taxes levied on fuel in the UK. The new rise will only compound the problems, with many smaller hauliers likely to be the worst hit as they will find it difficult to pass on the extra cost to customers.
The logistics industry is critical to the UK economy yet the tax system is making British hauliers uncompetitive. We are alarmed by the signals that the Government appears to be sending to such a crucial industry at a time when the economy appears to be stalling.As an immediate measure we urge you to scrap the 2p increase scheduled for this April. In the longer-term we would welcome the opportunity to work with you to develop an alternative pricing system which separates the way fuel tax is levied for cars as opposed to commercial vehicles to help the UK haulage industry remain competitive.