Announcing a seventh consecutive freeze in fuel duty in his autumn statement, Chancellor Philip Hammond recognised the impact of the tax on businesses and families.
But the Freight Transport Association (FTA) said a cut would have boosted Britain’s economy by putting money in people’s pockets and reducing costs for transport operators.
FTA has consistently called for a 3p per litre cut in fuel duty, which would deliver around £1,500 annual saving on the running cost of a 44 tonne truck.
As a founder member of FairFuelUK, the association has lobbied Government for a reduction in fuel duty to support transport firms that operate on tight margins and now face uncertainty following the Brexit vote.
FTA Deputy chief executive James Hookham said: “Naturally we are pleased with the Chancellor’s decision not to increase fuel duty in line with inflation as previously planned.
“The freeze will save truck operators - the majority of which are small and medium businesses - about £9,000 a year for a typical ten-vehicle fleet.
“The Chancellor has understood the arguments made by the FairFuelUK campaign and fuel duty has moved from being a ‘sin tax’ like alcohol and tobacco duty to being recognised as a core burden on families and businesses who can be helped by freezing it. The Chancellor needs to continue that logic and recognise that reducing tax duty in future will bring even greater benefit to the economy.”
The Chancellor’s autumn statement also committed an additional £1.1bn investment in local transport networks in England, where he said small investments could offer “big wins”. This included £220m to address traffic pinch points on strategic roads.
Hookham said: “The increase spending on infrastructure is great news and we await the details of which specific road and rail schemes will go ahead in the next few days, but we are pleased that the East-West corridor investment between Oxford and Cambridge is going ahead. Another priority for FTA is the route of the approach roads to the new Lower Thames Crossing between Gravesend and Tilbury.
“More money for local infrastructure is welcome and we will be presenting our list of preferred schemes to local highway authorities and the devolved governments to prioritise those that most benefit freight movements.”
Finally, the Chancellor also announced that the standard rate of Insurance Premium Tax (IPT) will rise to 12% from June 1, 2017. IPT is a tax on insurers and so any impact on premiums depends on insurers’ commercial decisions.