Business Groups: Scrap the January Fuel Duty Rise
A fuel duty rise planned for next year could put struggling firms out of business, the Forum of Private Business (FPB) has warned.
Under duty increases proposed by HM Treasury, fuel prices will rise by 3p a litre in January and a further 5p next August, adding around £1.50 to the cost of filling up an average vehicle.
The FPB’s chief executive Phil Orford said that businesses were already struggling to pay “exorbitant” fuel prices, and that further price hikes would damage small firms and make it difficult for many to survive.
“The planned increases in fuel duty simply can’t be justified. Our members have seen a continued rise in the cost of doing business over the last year, and according to our latest survey, 92 per cent of small firms saw an increase in transport costs.”
“Not only would significant tax hikes damage small firms further, it’s highly likely that growth would be affected,” added Orford. “Firms must be given a tax environment in which they can thrive.”
The FPB’s warning comes in the light of mounting pressure from MPs on the Government to take action on high fuel costs, viewed by many as detrimental to economic growth and an added burden on cash-strapped consumers.
A motion signed by 100 MPs has urged the introduction of a fuel price stabiliser, which would see pump prices capped when oil prices are high ― a measure backed by the FPB.
A voters’ petition containing more than 100,000 signatures has also been sent to Downing Street, demanding lower taxes on petrol and diesel.
Responding to the demands, HM Treasury secretary David Gauke indicated that the Government would go ahead with planned increases in duty, unless money could be found from other sources.
“Unless there’s another way of doing it, then we have a policy, which is an increase in January,”
he said in a recent interview with the BBC.
Prime Minister David Cameron’s spokesman added that any change in tax policy would not be announced before the next Budget.
“But we recognise as a Government that motoring is an essential part of everyday life for many and fuel is a significant cost.”