Reactions to Gordon Brown's announcement of a 2p/lit fuel duty rise were mixed. The FTA welcomed the deferment of Gordon Brown's proposed 2p/lit fuel duty rise until October this year.
It adds it is pleased that Brown has announced the increases for the two following financial years as well as it will enable firms to budget more accurately for the future.
The RHA reacted more strongly,
demanding a fuel duty rebate before the tax rise comes into effect. Chief executive Roger King says: "Lumping cars and lorries together is no longer an adequate solution to fuel duty. British motorists do not compete with drivers from abroad - British hauliers do. Hauliers must use the 6-month delay to prepare for two rate increases one in October and another next spring when diesel duty goes up by another 2 pence per litre."
The duty differential for biodiesel, at 20p/lit, was extended until 2009/10, but, says Ray Holloway of the Petrol Retailers Association, this is not as big an incentive as some may think. He says the full differential refers only to 100% biodiesel but that most manufacturers only allow fuel with a 5% mix, or the warranty on vehicles is affected. Therefore the deduction amounts to just 1p/lit.
"There's no benefit," Holloway says. "We're miles behind in terms of having
a green policy on this," he adds, citing the example of Sweden, where there is no excise duty on bio products.
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