Boost the economy by cutting fuel duty

Boost the economy by cutting fuel duty

“A fuel duty cut will provide a reassuring boost to businesses and consumers alike”, said Chairman of the Petrol Retailers Association, Brian Madderson, in a hard hitting letter to the Chancellor, following a recent meeting with Treasury officials.

Challenges

With the economy facing the twin challenges of a weaker pound and a stronger oil price, forecourt bosses say consumers need more money in their pockets to keep the economy resilient.

Pound Down

“As I write”, said Mr Madderson, “the pound is down 27 cents on the dollar on the year, and the price of a barrel of Brent crude is up 4.0% on the year.”

Windfall

The letter goes on to state that the Treasury is enjoying a £1bn duty windfall from petrol and diesel sales this year.

Reduced Spend

Mr Madderson also states: “The very rapid growth of online deliveries is one of the cornerstones of the UK’s economic improvement. Road usage by Light Goods Vehicles (LGV) rose by a staggering +6.3% in 2015. Pump prices are hitting consumers hard, resulting in an estimated £5bn reduced spend by consumers on an annualised basis. Average pump prices are 117 pence per litre (ppl) today compared with 114 pence in January 2016.”

Revenue

The Petrol Retailers Association boss added: “The Treasury could regain up to £1billion in revenue by collecting more fuel duty from long haul hauliers. Foreign and returning UK hauliers are filling up on the continent due to lower diesel duty (20 to 30% lower in Belgium and Luxembourg). Lower fuel prices in the UK would mean more money comes to the UK Treasury. The Border Force and DVSA could be given powers to fine lorries that are found to be overloaded with fuel, beyond, say, 300 litres.”

Hope

Mr Madderson told reporters that he has met this week with Treasury officials and that he now “trusts that the Chancellor is warming to the idea of a fuel duty cut and that his Autumn statement will set the economy on the road to prosperity”.