Govern­ment con­sults on red diesel tax bill

Canal Boat - - News -

THE GOVERN­MENT has is­sued a ‘call for ev­i­dence’ re­gard­ing the use of red diesel – which of­fers an op­por­tu­nity for boat­ing in­ter­ests to put their ar­gu­ments for­ward re­gard­ing the use of lower duty fuel in boats, which could be up for re­con­sid­er­a­tion fol­low­ing Brexit.

Use of low duty red diesel for leisure boat­ing was for­merly per­mit­ted in the UK. How­ever the Euro­pean Com­mis­sion re­fused to re­new the dero­ga­tion al­low­ing this, lead­ing to the present sit­u­a­tion where boaters can put red in their tanks but must de­clare what pro­por­tion of it they will use for propul­sion (as op­posed to heat­ing and other uses) and pay the higher rate of duty (equal to road fuel, known as DERV) on that part.

This still didn’t sat­isfy the EC, which threat­ened to take the UK to court to force boaters to use DERV; how­ever this has been over­taken by the re­sult of the EU ref­er­en­dum.

The Govern­ment con­sul­ta­tion is mainly about gaining more un­der­stand­ing of red diesel use as a re­sult of con­cerns about the im­pact of all types of diesel on air qual­ity (es­pe­cially when con­cen­trated in ur­ban ar­eas), rather than in con­nec­tion with the Euro­pean sit­u­a­tion. How­ever it of­fers the op­por­tu­nity to com­ment on all as­pects of the red diesel rules – in­clud­ing what uses are per­mit­ted.

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