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Blog 18: Is it our duty to reduce Duty?

By Fuelcard Frank

US President Joe Biden has called for a three-month suspension of America's national gasoline tax in response to the country's soaring energy prices.


The average cost of a gallon of gas, (petrol), is hovering near $5 (£4), up from roughly $3 a year ago.


With national elections for Congress coming in November, Mr Biden is under pressure to respond.

Currently, the US imposes a tax of roughly 18 cents per gallon on gasoline and 24 cents on diesel, using the money collected to help pay for highway infrastructure.

WHAT ABOUT US?

In the UK we pay Road Fuel Duty of 52.95ppl, 240.71p per gallon, to compare with the USA and we then pay 20% VAT on that Tax! Outrageous! Surely only gangsters run protection rackets that charge like that…… well?


Does that Road Fuel Duty go on the highway infrastructure as in the USA? Honestly….. NO!


Revenue from Road Fuel Duty = £28 billion

Expenditure on roads same time £7.9 billion

So where has the other £20.1 billion gone? Into the treasury never to be seen by motorists again!


COULD THE UK GOVERNMENT DO A ‘JOE’?

Joe Biden has called for a 3 month suspension in Road Fuel Duty in the USA. If Boris Johnson did the same, the UK Governments revenue would reduce for those 3 months by £6.9 billion. A mere drop in the Governments Ocean of finance, for example


Foreign Aid last year £14.5 billion

Military Aid to Ukraine £2.8 billion

Crossrail cost £28.25 billion

HS2 cost estimate up to £107 billion, and all to save 20 minutes from London to Birmingham!

This of course doesn’t include what the Government spent on Covid and supporting industry during Lockdown.


Governments of either party down the years have spent your money like it isn’t theirs, which of course it isn’t. They don’t plan long term as they know for sure that they won’t be in power long term, so any problems they cause will have to be sorted by some other future Government, they will be long retired and, in many cases, ‘tut tutting’ across the House of Lords benches!

EV’s for example are a real issue being pushed forward far enough to blame future Governments! The present Government has said, no more ICE cars after 2035, when those Ministers will be well retired. Great headline for the media to gobble up and don’t they look environmentally sound!


Sadly, it isn’t either environmentally sound or a sorted policy. The infrastructure simply isn’t in place and even by the Government’s own published figures, the charging network won’t be sufficient by the first stage in 2025 if the EV sales they predict are achieved. Where will all the extra electricity come from. What will it cost? How will they replace that £28 billion hole in their Road Fuel Duty finances?


They will tax EV’s like ICE cars are these days. They will add Road Fuel Duty to electric for road use. They will price roads per mile. Don’t imagine they will simply give it away, they won’t. And I don’t mean this Government, they will be long gone by then, it will be left to a future Government to implement that! Had the Government told the Motor/Oil industries that they had to get harmful emissions down to virtually zero, we’d have had a different solution!


So back to the title, could they give us a 3-month duty break over the summer to help us on our holidays? Yes they could, as the increase in families holidaying in the UK rather than abroad would easily make up the £6.9 billion Duty loss in VAT revenue to the UK economy, and don’t forget, the Government would still get the VAT on the fuel so not a total loss!


For example, and round figures, a £2 per litre of Fuel would go down to £1.36 including VAT, now that would encourage travel and if the average motorist used 50 litres/week for 12 weeks it would save each individual £384 to subsidise their UK Holiday! Also, what a boost to Industry and Distribution of goods! Wow!


Maybe Fuelcard Frank should be the next Prime Minister?


Fuelcard Frank


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