RH Freight, the UK's largest independent European freight company is warning of a serious crisis for small hauliers unless the amount of duty on fuel is cut to mirror European levels.
The company's Managing Director – Ian Baxter, believes that regular increases in fuel duty coupled with the rise in crude oil prices has created a situation which may force a number hauliers out of business.
“In the better years, the government has piled on the duty on fuel and hauliers have absorbed the increases in prices. However, we are now in a situation where many haulage companies are struggling because of increased competition and a slow down in the economy. This, together with the massive increase in fuel prices that we have seen recently, means that many smaller businesses are likely to go bust unless the Chancellor reduces duty very soon.”
Ian Baxter claims that hauliers have seen their net fuel prices rise by more than 20% over the last 12 months and believes that the UK government needs to urgently reduce duty to come in line with other European countries. “Certain European Countries have already taken action to reduce fuel duty, said Ian. “The UK should definitely follow suit as its tax rates are already out of line with the European average.
“I appreciate that there are problems with refinery capacity and that the price of crude oil has been increasing, but in the UK we still pay more for our fuel than any other European country. This is simply because we pay the highest rates of tax. 65% of the cost of a litre of diesel is tax, made up of duty and VAT, whereas, in Europe, the average amount of tax is less than 50% of the total cost of a litre.
“At a stroke, our government could help to save many businesses and jobs and make the UK haulage industry more competitive, simply by reducing the duty for industries like ours, that cannot operate without fuel. If it only gave back increases in revenue from VAT and North Sea oil revenues, that would be a major start in redressing the balance.”
Although he is not supportive of the fuel protests, Ian says that he does understand why some people feel that they have to demonstrate.
“Personally, I don't agree with these direct action protests,” said Ian, “because it will cause a lot of disruption to the country and I think that there are other ways that people can make their feelings known. However, the Government needs to understand the reasons why people feel that they have to do this, it is because their livelihoods are at stake.”