Howard Cox: Time to come clean on how we tax fuel

MY organisation FairFuelUK is the nationally recognised award-winning campaign fighting for lower petrol and diesel prices. It is widely accredited with stopping £100bn of taxes being levied on over 37 million road users since 2010, including businesses and the haulage industry.
Should fuel receipts be more transparent over the taxes paid?Should fuel receipts be more transparent over the taxes paid?
Should fuel receipts be more transparent over the taxes paid?

We all appreciate taxes are hugely sensitive issue with voters, and rightly so. Much of their fiscal anxiety is understandable, and a high proportion of this anger is often very much based on lack of tax transparency at the point of purchase. It can’t be wrong for MPs’ constituents to simply want to distinguish how much of their hard-earned money is given to the Treasury in their buying transactions.

Conservatives are inveterate supporters of a low tax economy. Yet, they also preside over one of the most punitive taxes in the world by stealth – fuel duty. They continue, as with previous administrations, to hide how much of this levy they take every time 83 per cent of the electorate – 37 million drivers – fill up their vehicles.

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As a responsible, caring and listening administration, concealing this tax can’t be morally right.

Since 2011, the Treasury listened to FairFuelUK Campaign after we proved that the level of fuel duty impacts on the success of our economy, jobs and consumer spending. The continuing freeze in duty under this Government has been widely popular.

Today Peter Aldous, MP for Waveney, will deliver a 10-minute rule Bill to Parliament calling for all taxes to be displayed in detail on fuel receipts.

His Bill for fuel receipts to clearly display fuel duty, as well as VAT, has significant cross-party support, including from the All Party Parliamentary Group for Fair Fuel. Jason McCartney and Martin Vickers are just a couple of the Yorkshire MPs supporting this move.

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The Government has a clear obligation to be open with UK drivers regarding taxes. The UK pays some of the highest prices at the pumps with 70 per cent of drivers having no choice but to use their vehicle for work, driving to places of education, visiting hospitals and social interaction. In fact, UK drivers pay the utmost fuel duty for diesel and the fifth highest for petrol in the world.

On top of the duty, VAT is also apportioned at 20 per cent on the whole purchase including the duty itself. When prices at the pumps fell to around £1 per litre in 2016, the tax the Government took from drivers reached 75 per cent.

Fuel prices in recent months have risen rapidly owing to weaker sterling, OPEC production cuts and market uncertainties blamed on Brexit. Consequently, VAT revenues for the Exchequer from constituents filling up have increased too. Total taxation to drivers is now around a heady 65 per cent with the average family paying £32 in tax every time they visit a garage.

But when drivers fill up, their receipts show only VAT and not the whole truth in taxes paid. Retailers tell FairFuelUK they are annoyed that they are seen as the villains, when the Government represents most of the cost of filling up.

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It’s time the Government revisited the question of full tax transparency on fuel receipts, first proposed by Robert Halfon MP for Harlow in 2012. With less than 20 per cent of fuel duty revenue being spent on roads, it is manifestly right that the high tax the Government takes from hard working drivers and small businesses should be clearly shown at the pumps on information signs, and most certainly on all fuel receipts.

Such a popular move will be welcomed by millions across the UK. Peter Aldous’s Bill is supported by the FairFuelUK Campaign, the TaxPayers’ Alliance, the RAC, the Freight Transport Association, the Road Haulage Association, and The Association of Pallet Networks to name but a few prestigious bodies.

Such a widely popular move will resonate profoundly with those families the Prime Minister addressed directly on the day she took office. Families expect the Government to be open and honest as to how much of their hard-earned money is taken in areas where they have no choice but to pay in their daily lives.

This Bill is targeted at 37 million drivers, MPs’ constituents, for them to see how much they are contributing to the growth of the economy and public services. The clandestine fuel receipt must end now and be replaced with open, honest and complete tax information for all drivers to see every time they fill up their vehicles.

Howard Cox is founder of FairFuelUK