At his latest Budget announcement, Chancellor Rishi Sunak stated he will maintain the fuel duty freeze and spend billions on roads.
Continuing the fuel duty freeze for a further year was welcomed by the commercial fleet Industry. Measures announced on red diesel caused some concern, however. The Chancellor announced removal of the entitlement to use red diesel from April 2022, except in agriculture, fish farming, rail, and for non-commercial heating (including domestic heating).
By removing this tax relief on pollution, the Government says it will encourage businesses and industry to seek greener alternatives and Improve vehicle efficiency. Development of these alternatives will more than double its investment in the Energy Innovation Programme.
Road Haulage Association (RHA) chief executive Richard Burnett said: “Of course, we welcome the freeze on fuel duty for the tenth year in a succession. However, the announcement that the tax relief on red diesel will be abolished in 2022 will come as a blow to the operators of refrigerated trailers.
"They’re the ones responsible for the movement of millions of tonnes of foodstuffs each year – both within the UK and to and from the European mainland.
“The Chancellor’s claim that this will not take effect for two years ‘giving businesses time to prepare’ is helpful but does not take account of the possibilities to use low emission or low carbon fuels.
"We shall be working with the Government and the sector to explore alternatives that support environmental objectives and the supply chain.”
Rosie Bailey, director of business development at CitySprint, was happy to see that the fuel duty freeze will continue and welcomed the introduction of new measures designed to help reduce emissions, protect the environment, and encourage greater use of cleaner vehicle, stating:
“The logistics industry has always understood its responsibility to reduce the impact of its operations on the environment,”
“With the focus on urban congestion and air quality, we have long-called for further investment in the infrastructure needed to support greener vehicle types. So, the pledge that drivers will never be more than 30 miles from a rapid charging station, along with a reduction of taxes on zero emission vehicles, is great to see.”
The Government says that access to high quality, convenient charging infrastructure is "critical" for drivers to confidently make the switch to electric vehicles.
Therefore, £500 million will be Invested over the next five years to support the rollout of a fast-charging network for electric vehicles, including a Rapid Charging Fund to help businesses with the cost of connecting fast charge points to the electricity grid. The goal is that drivers will never be further than 30 miles from a rapid charging station.