Fuel Duty Freeze is Seen as Good, but not Great
Fleet managers around the UK were glad to hear that George Osborne, Chancellor of the Exchequer, decided to freeze the fuel duty, but were hoping that the duty would actually be cut in response to falling fuel prices. As diesel’s price hit 136.59p per litre, the lowest mark since July of 2012, ACFO chairman Damian James expressed disappointment that the chancellor hadn’t extended a bigger benefit to the country’s business community, and particularly its fleets. “What the Chancellor really needed to do to give business a boost was to cut fuel duty, not simply cancel a planned future tax increase.”
Andrew Hogsden, senior manager of Lex Autolease’s strategic fleet consultancy, echoed James’ sentiment. “Reducing this burden would provide business with a much-needed cash flow boost as they look to capitalize on the opportunities presented by the recovering economy. “ And BVRLA chief executive Gerry Keaney joined the chorus of disappointment, saying, “The Chancellor likes to talk about tax cuts that deliver economic growth and therefore greater tax revenues in the long run. This is a classic example that he has chosen to ignore.”
The duty increase had been planned for September 2014, but the Autumn Statement of 2013 had indicated that it would not be imposed, and the Chancellor’s statement confirmed that it would not be put into place until spring of 2015. Though the fleet industry expressed unity in their disappointment, government advocates pointed out that the freeze represented a 20ppl reduction in what people would have been spending had the duty gone into action.