SNP slam fuel-tax rip off

Angus MacDonald

The SNP Group on Falkirk Council have claimed that the current high level of fuel duties are adversely affecting local businesses and damaging the future growth prospects of local firms. Taxes currently make up over 60% of the price of petrol and diesel, which the SNP say is unsustainable if the cost of fuel continues to rise significantly.

The SNP will this week call for the introduction of a fuel tax regulator by the Westminster Government.

The call comes ahead of this week’s UK budget as drivers, hauliers and farmers all feel the pinch of rising fuel costs.

The introduction of a Fuel Tax Regulator is backed by the Road Haulier’s Association. A fuel tax regulator would work by reducing taxes when the price of fuel goes up and vice versa, keeping the revenues received from fuel prices at a constant.

Commenting on the proposal by the SNP, Falkirk Council SNP Group’s Economic Development spokeperson, Councillor Angus MacDonald said:

“Over the past few months I have been approached by a number of local businessmen who are becoming increasingly concerned about the high fuel duties which are starting to harm their firms, particularly given the increase in the cost of diesel by 25% over the past 12 months.

“Fuel prices are beginning to cripple Falkirk district’s economy. Our hauliers are being priced out of business by rising costs. Our farmers are struggling to make ends meet because of fuel costs and families are seeing weekly fuel bills go through the roof.

All the time, without putting the tax on fuel up, the UK Government is making more in revenue because the price is higher.

A fuel tax regulator is a simple device. As the price of fuel goes up the level of tax comes down meaning industry and the public are not hit by rising taxes as well as rising prices.

This would give a real lifeline to Scotland’s hauliers who are unable to plan effectively for the future because they do not know what the price of fuel will be.

Keeping fuel at a more constant price enables everyone to make plans for the future of their business and for their own financial security.

Instead of putting fuel prices up at the budget the Chancellor should put in place a regulator.

If Labour’s Scottish chancellor won’t take this action then the SNP at Westminster will put forward their own plans with an amendment to the budget.
The proposal would see the introduction of a Road Fuel Regulator so that higher oil prices trigger lower fuel duties, which make up 60 per cent of the price of petrol and diesel. The Regulator would result in an automatic freeze on fuel duty increases and a reduction in duty to match any increases in VAT.”

Councillor MacDonald continued:
“With the projected slowdown in the world economy local firms must be given all the assistance they can get to weather any storm that is heading our way. The introduction of the Fuel Duty Regulator would go some way towards making the economic journey over the next year or so much easier for struggling local firms.”
One firm which has contacted Councillor MacDonald is GSS Ltd of Grangemouth. The Managing Director, David Balfour highlighted the crippling fuel duties as the main factor affecting the viability of his company.”

Mr Balfour commented:
“Much of my firms business is conducted in other parts of the country, therefore the cost of fuel is a major factor in the viability of my firm. The cost of fuel is making it difficult for me to compete in a market which is also now becoming saturated with competition from abroad.”

The SNP’s plans for a fuel duty escalator will help to keep fuel prices down, particularly if, as expected, the cost of fuel will rocket over the next year.
Every time oil prices go up we pay through the nose. However Gordon Brown and Alasdair Darling rake in the loot not just from corporation tax but also from increased VAT on the rising price at the pumps.

“Ironically Scotland as one of world’s largest oil producers is hit hardest as our haulage industry is most vulnerable to high pump prices.
“This proposal from the SNP would see a double protection for motorists and the road haulage industry. First, higher oil prices would trigger an automatic freeze in fuel duty rates, and second, any extra cash raised from VAT would go straight back into an equivalent cut in fuel duty.”

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