Wednesday, February 17, 2010

Freight Transport Association Slates Government Fuel Policy

"Own Goal" with Tax Hikes Causing Inflation
Shipping News Feature

UK – Anyone running a freight truck in the country is well aware of the way diesel prices have soared in the past couple of years. Shipping anything has become more expensive due to the combination of rising costs per barrel and increased fuel duty.Now the Freight Transport Association (FTA) has issued a formal statement claiming that Government policy in this area is a principal cause of inflation.

Jo Tanner of the organisation said yesterday:

“Inflation has risen largely off the back of the rising fuel costs of transporting goods and services. Fuel accounts for over 30 per cent of overall transport costs, and these costs trickle down to the services and businesses that rely on the logistics sector simply to run. It is anathema, then, to increase the tax imposed on the cost of a tank of diesel during a recession, especially when the actual price of a barrel of oil has doubled – yet this is precisely what the Government has done and is committed to doing in the future.”

She added that a doubling of oil costs during last year, from a low of $36 a barrel in December 2008, plus extra taxes, had caused fuel prices to rise to such an extent they formed the biggest single influence on the Consumer Price Index annual rate (a 2.2% jump in the twelve months to January)and the obsession of the Treasury to increase fuel duty had pushed Governments precious inflation targets out of reach.

“Rises in inflation are the last thing the Government will want this close to a General Election, yet the power to bring it down – and help businesses – is in its hands. By reducing fuel duty levels for commercial vehicles, it could help to keep prices of household goods down, and keep UK businesses moving.” she concluded.