Fuel Duty Freeze Welcomed By Haulage Industry

Plans to stop the rise in fuel duty for the 11th year in a row has been welcomed by transport logistics businesses, industry leaders and self-employed hauliers alike.

Richard Burnett, chief executive of the Road Haulage Association has described the move as part of the 2021 budget as “very good news” for owners and operators of commercial vehicles.

As it stands, the rate of duty for petrol and diesel vehicles will remain at 57.95 pence per litre for at least another year, with liquid petroleum gas (LPG) remaining at 31.61 pence per kg. Neither of these rates have changed since 2009.

Previous to this, there had been a “fuel price escalator” which would increase fuel duty by 3 per cent above the rate of inflation. However, after major protests in 2000, the price would only be increased at the rate of inflation and after 2009 has been consistently deferred.

This duty does not include VAT, which is also added to the price of fuel.

Currently, the rate accounts for half of the price of petrol on average and is a major expense for long-distance freight operators.

Other parts of the budget that are relevant to the logistics industry include an extension of the furlough scheme until September, allowing many skilled workers to be retained as well as a recovery loan scheme to help businesses stabilise.

As well as this, there have been increased calls within the industry to support a proposed trial of 3000 25-metre road transport vehicles, which if approved would allow for three times the capacity of a traditional 16.5m articulated vehicle.