Fleet Managers & Fuel Duty

The recent MPs debate on the subject of fuel duty has kept an issue that affects both businesses and private car owners firmly in the public arena.

The Back Bench Parliamentary session, called due to a FairFuelUK e-petition being backed by over 100,000 signatories, lasted four hours where over 35 MPs had a chance to speak on behalf of the people they represent.

The motion urging action on fuel prices was approved by MPs but is not binding on ministers. These price rises, due to be phased in over two rises in 2012, will add 8p a litre to pump prices.

The Automotive Industry Digest says in its “Editor’s View” column

Organisations such as the AA and Road Haulage Association have gone further than calling for those rate rises to be abandoned and, instead, want duty cuts. They suggest such a move will help stimulate the economy. Meanwhile, many businesses, it is suggested, could help trim their own fuel bills by cutting mileage allowances – it is suggested that some employers are paying around £6 in expenses for every litre their drivers use – and cracking down on driver fuel ‘fiddles’. In appearing to rule out a fuel duty cut Business Secretary Vince Cable warned drivers not to expect ‘freebies’ in the Statement. However, given the state of Government finances a freeze or even a fuel duty cut is only likely to mean a tax rise elsewhere.

With the Government unlikely to ease the issue and businesses who have already cut costs being forced to find more ways of easing the burden of keeping their fleets on the road, the money to keep doing business has to come from somewhere.

What now for Fuel Duty?

The “freebie” comment from Vince Cable is an interesting one. Putting off a planned tax cut isn’t a freebie and shouldn’t be regarded as such. If Road Hauliers are struggling to keep their fleets on the road, if businesses cannot afford to keep their fleets running and if private drivers are cutting down on non-essential journeys then it isn’t a freebie that consumers are looking for, it’s an open and fair system in calculating fuel duty.