Friday 18 September 2020

HGV road user levy suspended for 12 months

The government has announced that collection of the HGV road user levy that applies to trucks of 12 tonnes or more operating in the UK will be subject to a year-long suspension from 1 August, “to support the haulage sector as it recovers from Covid-19”.

The policy change will reduce financial liabilities for both UK and foreign hauliers, the government has said.

For UK operators, who pay the levy alongside their vehicle excise duty, a levy rate of zero will automatically apply at a vehicle’s normal renewal date from August onwards, so no action will need to be taken. According to a Treasury document, the government intends to allow non-UK hauliers –who pay via a daily, weekly, monthly or annual charge – to claim a rebate for levy already paid in respect of the exemption period.

A spokesperson for the government said: “The haulage industry is critical to keeping the country moving and plays a key role in supporting our economy recovery and growth.

“The suspension of the levy is intended to provide some relief to hauliers, given the difficulties faced by the sector during the pandemic.”

The amount saved will depend on the truck’s gross weight and axle configuration, as the charge was introduced to reflect the track costs of vehicles using the UK’s roads after complaints that foreign trucks were enjoying free use of the roads in competition with UK hauliers.

The scheme, which was launched in 2014, was adjusted last year to also take environmental factors into account – with lorries meeting the latest emission standards eligible for a reduction in the cost of the levy, while older, more polluting vehicles were required to pay more.

Earlier this year, the European Commission demanded that the UK reform the system, in a move which
some interpreted as the EU reminding the UK who would be boss in the post-Brexit world. The government has now announced that the system will be reviewed during its suspension to ensure it meets “current and
future objectives”.

Meanwhile, the prime minister Boris Johnson has announced a package of more than £100 million for investment in road schemes and projects across England, including fixing deteriorating roads, flood mitigation and bridge repairs on key highway routes.

The transport secretary Grant Shapps said: “As the country begins the recovery from Covid-19, we need to get on the front foot and invest in infrastructure in every region to reignite the economy, helping better connect people with opportunities in the future.

“By investing £100 million in local roads and reaffirming our commitment to better connecting communities, we are not just talking about levelling up – but making it happen.”

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