Consultation on red diesel ban
Boaters are to be consulted in the spring on plans to axe the use of red diesel to propel leisure craft in the UK.
The consultation is being held by Her Majesty’s Revenue and Customs (HMRC), which has liaised with the RYA, the Cruising Association, British Marine and the Inland Waterways Association on its plans.
In a statement, HMRC said: ‘The consultation will seek information on the impact of this change to help inform how and when it can be introduced.’
The scrapping of red diesel, which only applies to recreational boaters, follows a ruling by the European Court of Justice last October, which found that by allowing leisure vessels to use marked diesel the UK wasn’t complying with the EU Fuel Directive. A similar ruling was also made against Ireland, which has decided to ban marked diesel from 2020.
Under EU rules, fuel must be marked with a dye if it is sold at less than the full tax rate. In the UK, most marinas sell red diesel on a 60/40 split of full and lower tax rates for propulsion, and heating or power generation
The EU argued that this practice meant the UK was failing to fulfil its obligations under Council Directive 95/60/ EC of 27 November 1995 on fiscal marking of gas oils and kerosene.
The RYA is calling for a ‘long transition period’ in any move from red to white diesel.
Its director of external affairs, Howard Pridding, said there was real concern about the economic impact of any ban.
He said British Marine had spoken to fuel suppliers who had outlined that any changes to the existing fuel supply infrastructure, especially to meet a ‘no trace’ requirement (meaning tanks and fuel systems are completely purged of any trace of red diesel dye), would be too expensive. There are also environmental and health and safety concerns of boaters buying and transporting fuel from roadside garages.
“Companies don’t make money out of selling fuel. British Marine surveyed its members and a lot of businesses are saying that it will no longer be viable to provide fuel so we could face a fuel shortage, especially in places like the west coast of Scotland,” outlined Pridding.
There are also concerns about fuel supplies along inland waterways, where there is not the same demand for fuel as at coastal ports which will be able to continue to supply red diesel to commercial vessels.
When asked about the implications of Brexit, he described it as a ‘red herring’ as red diesel would still be an issue for cruisers in parts of Europe where it is banned from powering recreational boats.
British Marine also surveyed engine providers and refit specialists, who stated that it would be ‘too costly across the board’ for boat owners to change tank and engine systems on board in order to meet the ‘no trace’ compliance.