The FTA has claimed it would be “economically irresponsible” if George Osborne announced a fuel-duty increase in the March Budget.
According to a report by think-tank, the Institute for Fiscal Studies, the Chancellor may need to increase fuel prices in order to reduce the country’s level of debt.
However, the FTA claims that such a move would hinder the UK’s economic recovery following the credit crunch and weaken consumer confidence, adding that reductions in fuel duty would help the country grow.
“Regardless of the price of oil, for every penny fuel duty goes up it costs van operators around £100 million in a full year,” said James Hookham, FTA’s deputy chief executive.
“It won’t make them drive any less – goods still need to move to where they are needed – and it won’t help them invest in making their vehicles and drivers even more efficient. It will just cost them a lot of money,” he added.
Howard Cox, founder of lobbying group FairFuel UK backed the FTA in opposing a possible fuel duty hike: “The report, obviously instigated by the Treasury to prepare us for a fuel duty rise in the Budget, fails to properly acknowledge the positive effects of tax cuts on incentives, economic growth and job creation that have been shown irrefutably to be real by the CEBR [Centre for Economics & Business Research].”
“Obsorne’s helping out Google and Facebook with favourable tax avoidance, so why not be open and fair to UK’s 37m drivers too?,” Cox continued.
