Fuel Rationing.

[creakyknee]

Is the price of fuel just another method of getting traffic off the roads? My son paid £1.28 a litre for petrol at the weekend on the M6. How soon before it hits £1.50? As usual it hits the poor the hardest, people who have to use their vehicle for work or live in rural areas. Company executives, government ministers and those on expense accounts will continue to drive big cars, with no thought of the cost. Last time there was a fuel shortage, rationing was introduced but not implemented. I can see the lower paid no longer being able to afford to travel to work and it will be easier for them to stay at home on benefit. I'm now reckoning on an annual budget of at least £3000 for motorhoming. Has anyone else reckoned up their costs?

 

[malc d]

creakyknee - 2010-04-08 8:03 PMIs the price of fuel just another method of getting traffic off the roads? My son paid £1.28 a litre for petrol at the weekend on the M6. How soon before it hits £1.50? As usual it hits the poor the hardest, people who have to use their vehicle for work or live in rural areas. Company executives, government ministers and those on expense accounts will continue to drive big cars, with no thought of the cost. Last time there was a fuel shortage, rationing was introduced but not implemented. I can see the lower paid no longer being able to afford to travel to work and it will be easier for them to stay at home on benefit. I'm now reckoning on an annual budget of at least £3000 for motorhoming. Has anyone else reckoned up their costs?

I don't think there is a fuel shortage, simply more demand worldwide.I think I heard somewhere on the news the other day that fuel purchases in GB have dropped by up to 20 %.As many people have no alternative to buying petrol / diesel it just means that sales of other items will suffer.I have not worked out any costs, I just give more thought to when and where I drive. :-(

[creakyknee]

 

 

And what I drive! Usually try and use bicycle now for short trips.

 

[Colin9591]

I didn't realise it was being rationed, just thought it was the speculators/Gordon Brown's taxes & duties driving the price up yet again.

 

Fuel costs are a minor element of motorhoming costs. If you want to tally them all up, that's your choice. I'd agree though that I've also been using the bike or walking locally in preference to using the car.

 

We use the camper as everyday transport when we both go out but when necessary to drive on my own I use my toy car, it's horribly juicy but fun to drive.

 

Cheers

[CliveH]

The problem is the 80% overall tax applied to fuel. First you have fuel duty and then you have VAT on top of that and this equates to an overall rate of tax of circa 80%. In other words if a litre of fuel cost £1 then the actual cost is just 20p and the overall tax is 80p

 

So with the £ falling against the $ and oil being bought in $'s this means that fuel prices have gone up. BUT - with every penny in real cost a further 80% tax is levied. So if the cost of fuel is £1.29 a litre then the actual cost of the fuel is about 26p and the tax is £1.03.

 

I have been saying for a long time that this gearing of tax on fuel is wrong and that the tax should be capped at a certain level at each budget for the following year. If it were capped at, say 75p, then when we have a fuel price increase we only suffer the cost of the actual increase.

 

Whereas at the moment every 1p increase in the REAL cost of fuel requires us to pay a further 3.8p in tax.

 

 

 

[bob b]

When the price of crude oil drops, the price at the pumps doesn't go down. We're told that the crude oil is bought many months in advance and the price reduction will take some months to 'filter' through.

However, when the price of crude goes up, for whatever reason, the pump prices seem to increase immediately.

Is it me ?

[Brian Kirby]

If you were a chancellor, hungry for tax revenues to plug his £170BN black hole, what would you do?

If you were an oil company CEO, hungry to feed his shareholders dividends, what would you do?

Need I say more?  Dream on guys!  :-D

[CliveH]

 

Agree Brian.

 

But when the tax is costing jobs and the viability of businesses, you have to ask the question - especially at election time! (lol)

 

Admittedly this is from the Daily Mail!! :-S But it does give an idea of what the gearing of tax to the real cost of fuel is costing us all.

............................

 

UK petrol tax rises are SIX TIMES higher than the rest of Europe

By Ray Massey Last updated at 8:53 AM on 5th March 2010

 

 

Drivers have been hit with petrol tax rises as much as six times higher than the rest of Europe, it is revealed today.

 

Tax paid at the pumps in the form of fuel duty and VAT has soared in the past 15 months, analysis of official figures shows.

 

And motorists are warned the pain will continue when another 2.5p is added to the price of a litre of petrol and diesel on April 1.

 

Pain continues: UK drivers have been hit by a 13.53 per cent rise in petrol tax while for other countries in Europe the figure was as low as 2.23 per cent. UK tax on fuel went up 13.53 per cent between November 2008 and last month.

 

In Austria the figure was just 2.23 per cent, while France and Germany also saw similarly small rises. The analysis by the AA found that on November 24, 2008, Britons were paying 92.79p a litre for unleaded - of which 64.17p was tax. A fortnight ago, the price had increased to 111.89p a litre - of which 72.85p was tax.

 

So, the tax rise alone was 13.53 per cent. The total rise in the pump price was 20.58 per cent.

 

For UK diesel car owners, the fuel tax burden increased 8.10 per cent - lower than the 8.33 per cent in Ireland, but well above the 2.89 per cent average for Europe.

 

The UK tax risks further stoking up inflation and putting the economic recovery at risk, said AA president Edmund King.

 

'Our research shows that most other European countries have resisted such fuel tax hikes over the past 15 months, and they have also had to deal with the fallout from the credit crunch,' he added.

 

'Petrol and diesel are necessities for the majority of the population and businesses, yet are taxed as luxuries. Further increases could backfire on economic recovery.

 

'With higher fuel prices contributing significantly to inflation, adding another 2.5p to the cost of petrol and diesel in April could do more harm than good to the public purse, economic recovery, hauliers and car owners.'

 

On top of the tax rises an average 1.5p a litre rise in pump prices since mid-February sees petrol now at £1.13p a litre.

 

The Treasury admitted that soaking motorists with higher taxes at the pumps was a central plank of the Government's strategy - its 'deficit reduction plan' - to reduce its massive debts.

 

The AA report based on official EU figures reveals that since the Pre-Budget Report in November 2008, the tax taken by Chancellor Alistair Darling has soared.

 

This latest in a string of rises will add 'inflation plus 1p' to the total cost. VAT is then added on to the new flat rate of duty - effectively a 'tax on a tax'.

 

But the Treasury denied ripping off motorists. 'Duty increases are an important part of the deficit reduction plan, as well as supporting the Government's environmental agenda,' a spokesman said.

 

...............................

 

For "environmental agenda" - read applying "green taxes" to make us uncompetitive in the world – the main point on the real agenda of the Anti-capitalist green loonies.

 

 

[Guest Tracker]

For every 6p per litre that the price rises Grasping Gordon grabs 1p in extra VAT - so thats about 3p a litre so far in recent months on the 18p or so that fuel has risen in cost?

 

I don't know how much fuel is bought by non VAT registered users who are unable to claw it back via their VAT return but let's keep it simple and say about one third?

 

In which case the price rise alone has gained Grasping a tax bonanza of 1.0p on average over all fuel sales totally negating the need for a 1p duty rise on revenue grounds because the 'budget' (such as it is) relied only on the 1p duty and not the vat rise?

 

By the way he also charges VAT on the duty just to make sure we are all screwed properly!

[malc d]

Footnote : The chancellor for the last couple of years or so has of course been Alistair Darling, not Trackers favourite, 'Grasping' Gordon.

 

 

;-)

[CliveH]

Agreed - but it was "grasping Gordon" that set up the fuel duty escalator that is doing so much damage to the economy.

 

Darling is just the incumbent* at No 11 that has to follow Gordon’s instructions.

 

*Hopefully not for much longer

 

[malc d]

CliveH - 2010-04-12 8:06 PM

 

Agreed - but it was "grasping Gordon" that set up the fuel duty escalator that is doing so much damage to the economy.

 

Darling is just the incumbent* at No 11 that has to follow Gordon’s instructions.

 

*Hopefully not for much longer

 

 

As I recall it was the Conservatives who set up the fuel price escalator in 1993 at annual increases, above inflation.

 

 

 

 

 

[CliveH]

The Fuel Price Escalator (FPE) was the practice of automatically increasing hydrocarbon oil duty (better known as 'fuel tax') in the United Kingdom ahead of inflation. The escalator was introduced as a measure to stem the increase in pollution from road transport and cut the need for new road building which was then a politically sensitive topic. The escalator also resulted in significant increases in revenue for The Treasury.

 

The fuel price escalator was introduced by the Conservative government in 1993 and set at an annual increase of 3% ahead of inflation, later rising to 5%. After gaining power in 1997, the rate of increase was raised by the Labour government to 6% per year. The last rise due to the escalator took place following the budget on 9 March 1999.[1]

 

Tax increases above inflation have not ceased, however: the increase in fuel duty for 2009 was above inflation and the tax is planned to increase "on 1 April from 2010 to 2013 by 1 ppl above indexation in each year." [2]

 

The end to the escalator was announced on 9 November 2000, following the UK fuel protests, of which it was a contributory factor. When the escalator ended, fuel in the UK was the most expensive in Europe, with fuel tax representing over 75% of the retail price of fuel. In 1993 UK fuel had been amongst the cheapest in Europe

 

..................

 

So it was introduced by the Conservatives (not my favourite party :-S) at 3% when fuel was the cheapest in europe.

 

The escalator was dropped after fuel price protests.

 

Hmmmmmm - interesting.

 

But if anyone wants to know why this government need SO MUCH TAX! - all you have to do is to see how they spend OUR money:-

 

http://www.taxpayersalliance.com/media/2010/02/daily-mail-ministers-lavished-9m-on-climate-change-stunts-but-public-opinion-is-left-cold-by-global-.html

 

Worth a read.

[malc d]

As I thought then.

The fuel tax escalator was set up by the Conservaties and dropped ( or at least interrupted ) by Labour.

I agree with CliveH that it's done a lot of harm to the economy.

 

I wonder what George Osborne will come up with.

 

 

:-(

[Guest pelmetman]

Tracker - 2010-04-12 7:09 PM

 

For every 6p per litre that the price rises Grasping Gordon grabs 1p in extra VAT - so thats about 3p a litre so far in recent months on the 18p or so that fuel has risen in cost?

 

I don't know how much fuel is bought by non VAT registered users who are unable to claw it back via their VAT return but let's keep it simple and say about one third?

 

In which case the price rise alone has gained Grasping a tax bonanza of 1.0p on average over all fuel sales totally negating the need for a 1p duty rise on revenue grounds because the 'budget' (such as it is) relied only on the 1p duty and not the vat rise?

 

By the way he also charges VAT on the duty just to make sure we are all screwed properly!

 

Just a small point as someone who is VAT registered, although you can claim back the VAT on fuel, you then have to pay a fuel scale charge which negates most if not all the gain :-(

[Guest Tracker]

pelmetman - 2010-04-13 2:02 PM

Just a small point as someone who is VAT registered, although you can claim back the VAT on fuel, you then have to pay a fuel scale charge which negates most if not all the gain :-(

 

Yes - of course - how right you are! I forgot that from my VAT registered days!

 

But if you do enough miles it still shows quite a savings and if you don't use the vehicle for any ostensibly private use at all - as with a van maybe when you also run a car for which you do not claim VAT on the fuel - you don't, as I recall, have to pay the charge - but I might be wrong as it's been a few years now?

[Brian Kirby]

So, on the above basis, fuel tax is an unpopular tax.  There's a surprise!  :-)

Now let's play a little game.  What would be your favourite tax, and why?  What should taxes be spent on, and why?

Could you conceive of a modern state in which there were no taxes?  How would it work?  Would it result in a stronger economy overall?  Or would it merely result in an economy in which the fit, bright, and strong take all, and then fortify their homes and businesses against the hoards of the sick, weak, feeble and dispossessed?  Or what?

[W3526602]

Hi

 

NI contributions are passed on to the customer. So if NI goes up, cost of living goes up.

 

NI stamps are a stealth income tax.

 

So do away completely with NI contributions, and raise rate of VAT to 20% ...... temporarily. You then have the choice of whether you pay it or not. If you don't buy anything, then you won't pay VAT.

 

Employers will save their contribution, so will be more willing to employ new staff. Employees will get a bigger wage packet.

 

But as NI has been taken out of the equation, the price of goods should go down. Exports should be easier, cos goods are cheaper. Imported goods will be more expensive due to higher VAT, but playing field in UK will be levelled - slightly. So buy British, even better for jobs.

 

All the wrinklies who live on interest on their savings will be better off, cos if VAT goes up, interest can go up too.

 

I wish I knew what I was talking about.

 

602

[Basil]

Brian Kirby - 2010-04-13 3:12 PM

So, on the above basis, fuel tax is an unpopular tax.  There's a surprise!  :-)

Now let's play a little game.  What would be your favourite tax, and why?  What should taxes be spent on, and why?

Could you conceive of a modern state in which there were no taxes?  How would it work?  Would it result in a stronger economy overall?  Or would it merely result in an economy in which the fit, bright, and strong take all, and then fortify their homes and businesses against the hoards of the sick, weak, feeble and dispossessed?  Or what?

My contribution to 'the game' would be to make all taxation clear and transparent, so only tax to the value of what is to be spent where it is spent, e.g. only raise VED to pay for the roads, NI to pay for health and welfare, income tax to pay for the running of government etc. (that should be broken down to show what percentage is being used where etc. etc., that might focus a few minds.Bas

[Guest pelmetman]

I read about Peak Oil on another forum which had a very interesting link http://en.wikipedia.org/wiki/Peak_oil

It might help fuel the debate (lol)

[Brian Kirby]

Yes.  Then we could have a war tax to pay for the forces - or have we been there before?  :-D

[malc d]

Basil - 2010-04-13 5:10 PM

Brian Kirby - 2010-04-13 3:12 PM

So, on the above basis, fuel tax is an unpopular tax.  There's a surprise!  :-)

Now let's play a little game.  What would be your favourite tax, and why?  What should taxes be spent on, and why?

Could you conceive of a modern state in which there were no taxes?  How would it work?  Would it result in a stronger economy overall?  Or would it merely result in an economy in which the fit, bright, and strong take all, and then fortify their homes and businesses against the hoards of the sick, weak, feeble and dispossessed?  Or what?

My contribution to 'the game' would be to make all taxation clear and transparent, so only tax to the value of what is to be spent where it is spent, e.g. only raise VED to pay for the roads, NI to pay for health and welfare, income tax to pay for the running of government etc. (that should be broken down to show what percentage is being used where etc. etc., that might focus a few minds.Bas

BasBut that is not a new idea ( so no bonus for you I'm afraid).That's " hypothecation of taxes " The problem is, if you don't raise enough VED roads wouldn't get repaired.NI certainly wouldn't cover the cost of the NHS.....etcCertainly a good idea if the govt. had to publish details of where all our taxes go, and I don't mean in millions like they do now I mean in hundreds of pounds. Certainly would be an eye opener I'm sure.Should be easy to do now we have the internet.In the meantime let's all stand by for a change from 'Grasping Gordon' to 'Grasping George ' ( i.e. more of the same with a different name ). ;-)

[Guest Tracker]

Abolish employee and self employed NI CONtributions altogether and add the lost revenue onto income tax for total transparency.

 

At the same time you could call the employer's NI CONtribution 'Employers Income Tax' or whatever.

 

The abolition of one confusing tax in favour of one clear tax should please everyone - except the civil servants who would no longer be needed to enable such a complex and devious tax to be levied.

 

Raise the basic rate of VAT to 25% for all luxury items like cars, TVs, cameras, computers and the like (most of which are imported anyway!). This might curb the throw away society a little and make repairing things viable again - creating new jobs maybe?

 

At the same time create new lower bands of VAT at maybe 17.5% for items deemed to be acceptable for the 'average' family to live a 'normal' life - like sweets, soft drinks, snacks etc, magazines, clothing and footwear.

 

How about reducing the duty on road vehicle fuel and replacing it with a higher rate of VAT so that private motorists pay no more but business and transport users can cut their costs and reduce the cost of everything that travels to the end user by road?

 

Not perfect solutions any of 'em granted - but just a thought or two from an idle mind!

[CliveH]

If the tax regimes were simplified then collecting them would be considerably cheaper. Currently we have:-

 

Income Tax on income

 

Income Tax on Savings interest

 

National Insurance for employer

 

National Insurance for the employee

 

Insurance Premium Tax

 

Travel Tax levied on Air Travel

 

Capital gains Tax

 

Corporation Tax

 

VAT

 

Vehicle Excise Duty

 

TV licence

 

Stamp Duty

 

Inheritance tax

 

Council Tax

 

Fuel duty.

 

Excise Duty on alcohol and tobacco (I do not smoke but I do like my wine)

 

General Betting Duty - (I do not bet)

 

 

 

So - the trouble is collecting all these different taxes costs a lot of money and manpower. We could save an awful lot of money if the tax system was simplified - the classic example is as often cited here - we could get rid of VED (Road Tax) and simply place the cost onto fuel.

 

More efficient, and fair (those that use the roads more and have gas guzzlers pay their just amount) of course - but the PC brigade do not want that - they want to use the tax system to control what sort of vehicle you have. It won't work of course.

 

But that is not the point. Rather than actually DEAL with the situation of Peak Oil, the PC brigade would rather just tax us. Because that is all that they know. What we need is investment in new technology – not £9M of tax payers money wasted on lecturing us about “Global Warming” and how sinful we all are for not believing in the new Climate Change Religion/bandwagon the PC brigade has jumped on.

 

Think what research could have been done on alternative energy sources with that £9 Million.

 

Instead Milliband spent the money trying to convince us that we are all going to hell via Global Warming using things like adverts that scared children by way of drowning cartoon dogs and were deemed to be inaccurate by the Advertising Standards Authority!

 

I wonder what Milliband will say to HIS children when the oil HAS run out and they ask what he did to provide alternatives?

 

“Not a lot” he will say – “but I did spend £9Million in one year alone on adverts that nobody believed and the ASA banned”

 

On a broader note all the different taxes could be simplified and the collection of them streamlined. But it will cost jobs in the public sector, so there will be a cost to some, but a huge benefit to the wealth producing sector.

 

[teflon2]

In the dim and distant past the now named VED was the road fund licence and was in so much credit even after road costs were deducted that the Treasury had it put into gereral taxation so they could waste it however they found fit and the taxation is already too high on fuel so please dont suggest that they increase it further.