Trade groups make pre-Budget tax pleas
Following the election of the new government in July, transport trade associations have outlined their priorities for its first Budget, scheduled for 30 October.
The prime minister Keir Starmer has warned that the Budget “is going to be painful”, requiring difficult choices in order to address a claimed £22 billion black hole in the public finances.
Logistics UK has urged the chancellor, Rachel Reeves, to protect fuel duty in order to empower the industry to help drive economic recovery.
“Fuel is the largest single expense that logistics businesses have to bear,” said Logistics UK’s policy director Kevin Green, “and the current rate of fuel duty is enabling the industry to start planning for a decarbonised future.
“With the sector already operating on extremely narrow margins – often only 2.5 per cent – increasing fuel duty would heap the cost pressure on operators. This would not leave enough spare cash for our industry to implement the necessary steps to take us into a Net Zero future without passing on the cost to the end customer, something our members are loath to do.”
Logistics UK cites current industry estimates suggesting that the weekly fuel bill for a 44 tonne diesel HGV is around £888, with £436 taken in fuel duty by HMRC.
“With wage costs and the price of new vehicles rising, pressure on the logistics industry continues to mount, at a time when the sector is committed to helping kickstart economic recovery and growth. Rather than stifle the increased economic activity which our industry is able to drive, we need Ms Reeves to consider other alternatives to fill the fiscal gap,” said Green.
Meanwhile, the Road Haulage Association (RHA) called on the government to extend full expensing to the cost of leased asset vehicles, thereby supporting investment in zero-emission vehicles and infrastructure. It also reiterated its call for ministers to introduce an emissions-linked rebate on fuel duty, which it says would make UK businesses more competitive with their counterparts across the Channel.
“Incentivising the uptake of low-carbon diesel alternatives like HVO – which can reduce emissions by 90 percent – would speed up decarbonisation,” said the RHA. “Better access to funding would also help our industry drive economic growth through the National Wealth Fund, as will the pledged reform of the Apprenticeship Levy to help operators recruit and train people into key roles.”
