Fleet News

Firms face soaring bills over fuel tax escalator

FLEETS face the risk of runaway fuel bills as the Government asserts its commitment to the fuel tax escalator. Continued pressure to persuade drivers to use alternative transport and greener fuels is seeing fleets stung at the garage forecourt.

The result of above-inflation Budget fuel tax increases will mean unleaded petrol and diesel reaching a minimum nationwide average of about 318p a gallon/70p a litre and 321p a gallon/70.6p a litre respectively - an increase of 26p a gallon/5.7p a litre according to PHH AllStar figures - if Chancellor of the Exchequer Gordon Brown sticks to the already announced 6% hike in real terms. However, motoring organisations fear the increases in the March Budget could be even higher following John Prescott's admission this week that Britain is failing to meet agreed pollution reduction targets.

The admission is likely not only to be used to justify the annual Budget fuel tax escalator but pave the way for the introduction of graduated vehicle excise duty - a proposal out to consultation until January 31. For a fleet of 100 diesel cars averaging 39.65mpg over 18,000 miles the fuel bill will increase by £11,803, using figures provided by PHH Vehicle Management Services. The fuel bill increase for a same-sized fleet of unleaded petrol cars averaging 32mpg would be £14,586 under the minimum Budget rise.

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