Fleet News

Political storm brewing over policy on fuel duty

A FURIOUS political row has blown up over the Government's annual 6% real terms increase in fuel duties which continues to send fleet bills soaring. This week Treasury officials denied national newspaper speculation that Chancellor of the Exchequer Gordon Brown was proposing a radical rethink on the annual Budget increase amid increasing nationwide discontent at the tax led by the road haulage industry.

Meanwhile, Conservative Party leader William Hague has pledged to reverse the annual rise in fuel duties - introduced by the Tories when it was in power - and halt moves to introduce road pricing if his party is returned to power. Hague blasted Labour's policy of increasing fuel duty by at least 6% plus inflation and slammed proposed legislation to allow road tolling as 'vindictive and spiteful' - both cases highlighting a Conservative Party U-turn as the Tories also first suggested road pricing.

Before the Conservatives left office, the annual fuel duty escalator was 5%, although the party says this was not meant to be a permanent tax.

But Hague signalled that the Conservatives were turning over a new leaf, saying: 'Labour has been particularly keen to introduce new taxes on road users with punitive increases in petrol and diesel tax. We believe it is wrong to tax motorists for roads they have already paid for through their taxes. We will reverse Labour's vindictive tax increases on motorists and hauliers.'

However, Transport Minister Dr John Reid told the House of Commons the Government's fuel policy was achieving its aims to cut up to five million tonnes in CO2 emissions by 2010. Labour MPs demanded to know how the Conservatives would make similar reductions in CO2 if they abandoned the fuel escalator and fill the estimated £1.6 billion hole it would create in public finances.

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