Thoughts on fuel prices

[eddyramrod]

Without working out any detailed figures, the real big stuff, that we used to call Class 1, typically turns in something like 8mpg. Obviously that has to be an industry-wide average as some will do better, some worse, and actual figures will depend on all kinds of variables. But if anyone wants to look at the detail, 8mpg is good enough to work with.

[HillmanImp]

Whilst it will save money on some cars (I can only drive one at a time after all) my pre 72 cars will become more expensive to run and for that reason I'm oot, for the second time this week.

[CreepingJesus]

Also, can someone who knows about HGV mileage/RFL/mpg tell me what the effect of no road tax but an extra 25p a litre on diesel would be?

 

Go and lease a unit, and the standard term is for 150,000km/yr, which is a reasonable annual mileage. Say 100,000mi to make the maths easy. Lease a V8 Scania to run the fish down from the North East, at max speed - you'll be lucky to get 6mpg. Something more moderate, on easier work, with a good driver will average 9mpg, maybe 10.

If you're bulk buying diesel the way the haulage industry does, the best price you'll get is (I believe) about £1.29 a litre. Say £1.30 to keep it easy.

So our range is...

16,667L p.a x £1.30 = £21,667 in fuel, in the first case

10,000L p,a x £1.30 = £13,000 in fuel, in the other.

 

For what it's worth, the ballpark figure of '£20 grand a year' has been mentioned for years: as fuel got dearer, operators tended to buy/lease the more economical trucks, and we drivers went on innumerable 'SAFED' courses and became guardians of the environment*. So economy improved overall, as the price rose. Still fucking irritating to think that Fag Osbourne's department earns more in fuel duty from me, than I do wages.

[cobblers]

I'm going to do some mega over simplified maths, cos I'm on the fence about this.

 

Let's say the gov decide to scrap road tax, and they do some calculation and add some duty on fuel to earn the same money as they get from tax (ignoring the massive administrative savings, and subsequent dole payments for 2/3rds of the welsh population and the fact that I know nothing about the haulage industry and they are the main consumer of fuel so these calculations are going to be massively flawed because of this)

I don't know the overall figures so I'm just going to calculate it from a mister average situation.

Assuming mr average does 12k a year in a petrol car that does 35 to the gallon, and he pays £220 a year in tax.

The overall fuel costs are £2112 for the year, and the tax is £220, so if we stick the price of that onto fuel, it's more or less 10% extra.

 

Works for some people, not for others. I don't drive far (5k a year at most), but my van is shit on fuel so I'd lose out. I'd still rather pay a bit extra and not have to bother.

 

But this extra duty on fuel would really cripple a lot of industries who are stretched tightly as it is so I can see why it's not happening.

 

However, if we factored in the full costs of pissing about taxing vehicles aswell as the enforcement of tax offences, I bet things would be a lot more attractive for everyone concerned

[CortinaDave]

Fuel prices are absolutely crippling me as it is. So I'm out.

[Spiny Norman]

I wouldn't mind if they actually spent some of the billions they fleece off us on fixing the fucking awful roads.

[willswitchengage]

Okay time to do the maths that hopefully substantiates my original argument.

 

2009 VED revenue: £5.63bn

2009 fuel duty revenue: £26.89bn

 

Under Will's new system, road tax would obviously be free and fuel duty revenue would obviously now become 5.63 + 26.89 = £32.52bn (incl the extra VAT that would be paid on it)

 

£26.89bn / 57.95p = 46.4bnL of fuel sold across the UK in that year.

 

46.4bn / 5.63bn = the extra you're hypothetically paying at the pumps, which, = 8.24p more per litre

 

So, to use our lorry driver example using 16000L of fuel a year, he is paying £1280 more, but is saving £1850 in tax.

 

My example... 5000 miles a year at 1L/10 miles = 500L a year, paying £40 more at the pumps but £215 less in Swansea.

 

So, who loses?

 

The Golf travelling salesman who pays either way no road tax, but at 20K miles a year at £160 more.

[Tayne]

57.95p per litre?

[Luxobarges_Are_Us]

I'm not in good enough condition to do any actual maths myself, but the fuel duty amounts are different for each fuel.

[Des]

I have the pleasure of living in the middle of the highest concentration of callous, arrogant, selfish, stupid shit drivers in the country, awful, just really awful beyond description. As a result, in recent years I've actually been happy to see fuel prices rise, my theory being that as the masses of fuckwits, (who have been busy cluttering up every inch of space over the last decade, you know the ones), get priced off the road, the extra mpgs I could score by being able to cruise in top gear for any appreciable time may mean the costs break even. In recent times I've noticed a monthly cycle on the roads, after payday, absolutely horrendous for about a week, and then calms down kind of to the level it was a decade or so ago, and in those few weeks I get a noticeable amount more from a tankful. I've not done any calculations, but I reckon there's a magic figure somewhere between £1.50 and £2 per litre where the actual cost per mile will bottom out.

[gtd2000]

I wouldn't mind if they actually spent some of the billions they fleece off us on fixing the fucking awful roads.

 

The roads around here are diabolical at the moment.

 

When I came back from the USA in January, I thought I'd got off the plane in the wrong country....

[retrogeezer]

Roads are a disgrace with the amount of income fleeced off the motorist. It's not good when every single journey you make involves taking your attention off driving to swerve around tyre/suspension damaging huge pot holes.

 

And again it's the lower paid that are hit in the pocket, company car owners and chauffer driven bigwigs couldn't give a shit. Tyre and suspension damage would write off my bluebird.

[Cavcraft]

Your HGV example alone answers your 'who loses' question, Will. If the government did lose money because of that then we will all lose out because someone will have to fork out and it will be everyone as fuel costs will rise massively.

[Volksy]

I wouldn't mind if they actually spent some of the billions they fleece off us on fixing the fucking awful roads.

 

Technically they renamed your tax disc from RFL (road fund licence) to VED (Vehicle excise duty) so they can spend it on anything but the roads.

[Volksy]

The road tax on fuel would also insure that cars and lorries visiting the UK pay their fair share too.

[Ross_K]

Road tax is a joke and, as somebody said earlier, doesn't seem to serve any purpose other than the man in the post office seeing that you have two pieces of paper for MOT and insurance. Totally redundant these days as both of these things are computerised.

 

I'd love to see a situation where the price you pay at the pumps for fuel includes the so-called road tax and third party insurance.

 

It'd never happen though as politicians couldn't be trusted to not hike the price every time they need to buy another batch of Apache helicopters for Afghanistan or fund a transgender midget ballet company.

[willswitchengage]

I'm not in good enough condition to do any actual maths myself, but the fuel duty amounts are different for each fuel.

 

For everything other than LPG the duty is that 57p figure I mentioned. http://www.hmrc.gov.uk/budget2011/tiin6330.pdf

 

In places like France we have the cheaper diesel as they reduce the diesel duty to benefit commercial vehicle users, mainly agricultural.

 

Your HGV example alone answers your 'who loses' question, Will. If the government did lose money because of that then we will all lose out because someone will have to fork out and it will be everyone as fuel costs will rise massively.

 

If you read what I was saying carefully, then you will see that I redistributed the current VED revenue into a hypothetical addition fuel duty, which I calculated to be about 8p per litre. That truck example shows how a typical user would not be adversely affected in this "true pricing" system. If you want to have a good moan about fairness then try to figure out why the most elitist and polluting transport method - air - pays no duty OR vat on its fuel.

 

Bumpy roads? No problem.

 

 

[Luxobarges_Are_Us]

I'm not in good enough condition to do any actual maths myself, but the fuel duty amounts are different for each fuel.

 

For everything other than LPG the duty is that 57p figure I mentioned. http://www.hmrc.gov.uk/budget2011/tiin6330.pdf

 

Amazing. I always thought that diesel was easier to refine than petrol and that it was more expensive only because of taxation.

[Pete-M]

Amazingly, you're right. Diesel is nowhere near as refined as petrol.

[Ross_K]

Amazing. I always thought that diesel was easier to refine than petrol and that it was more expensive only because of taxation.

 

I would say you're right - diesel is cheaper than unleaded here in Ireland, and has been for as long as I can remember.

 

http://www.drive-alive.co.uk/fuel_prices_europe.html

Since the last update in December prices have risen across the board. Denmark has seen the greatest hike in prices of close to 20%, with petrol up by 28 cents and diesel by 26 cents. Denmark is now the third dearest country for petrol, behind Italy, and Norway remains the dearest. Italy retains its place as the most expensive country for diesel, with Norway second and the UK third.

 

Britain has seen lower price rises than many countries, and has slipped down to seventh dearest for petrol. If you are heading east then Hungary, Poland, Slovenia and the Czech Republic are all relatively inexpensive. The only countires in western Europe that come close are Spain and Luxembourg.

[willswitchengage]

The road tax on fuel would also insure that cars and lorries visiting the UK pay their fair share too.

 

Sadly this is not always the case, foreign lorries tend to have long range fuel tanks so can get to from Dover to their destination and back on cheap French of Belgian diesel. Hence, why many EU countries now have the vignette system, often exclusively for HGVs.

 

I would have thought diesel is more expensive than petrol due to higher demand? petrol is used almost exclusively for cars. Diesel is used in cars, commercial vehicles and industrial applications. Plus, its fraction is very near to other heavy oils such as jet fuel/kerosene so I imagine that extra demand pushes prices up. Perhaps...

[gtd2000]

I'm not in good enough condition to do any actual maths myself, but the fuel duty amounts are different for each fuel.

 

For everything other than LPG the duty is that 57p figure I mentioned. http://www.hmrc.gov.uk/budget2011/tiin6330.pdf

 

In places like France we have the cheaper diesel as they reduce the diesel duty to benefit commercial vehicle users, mainly agricultural.

 

 

Don't forget you still have to add 20% VAT on top as well...

 

So the Government is taking at least 20p more per Litre.

[warren t claim]

This in an interesting subject.

 

Right, if you scrapped tax and lodded more duty on fuel the cost of everything in the shops would have to rise accordingly, not just because the cost of transportation of the goods to the final point of sale and end user. The cost of sales between manufacturer, wholesaler and retailer would rise causing a knock on effect to the consumer. Calculating and trying to offset the cost of the VED into all of those individual movement of goods is neigh on impossible.

 

Governments of all colours have to work towards tight inflation targets and as the cost of road fuel is included in the retail price index it would be a very brave political party who deliberately ramped up inflation.

[Justin Case]

Any system will have winners and losers, a combination of a fixed sum (VED) and variable sum (Fuel tax) is probably the best compromise, especially for rural folk and the haulage industry. Whatever you call it VED is a licence that allows you to use a car on the road, and as such the fairest way is to have a fixed rate for all cars (wasn't it like that years ago in any case?) I pay the same for my television licence whatever the size of my telly and no matter how much I watch, although of course I will pay more for electricity if I watch more.

 

The actual taxing system can't be very expensive to run, it only takes a few keystrokes or a couple of minutes of a post office clerk's time; the cost is more likely to be sorting out which car goes into which bracket. The whole thing is a con in any case, based on one arbitary and meaningless figure. The whole climate change thing is based on a mixture of manipulated figures and downright lies; get rid of the entire climate change industry and we could probably cut fuel duty, have our own aircraft carriers and even have a bit left over for lesbian poetry readings.

 

Oh, and the Olympics are costing us more than a whole years yield from VED and not even one motor sport event is included

[willswitchengage]

This in an interesting subject.

 

Right, if you scrapped tax and lodded more duty on fuel the cost of everything in the shops would have to rise accordingly, not just because the cost of transportation of the goods to the final point of sale and end user. The cost of sales between manufacturer, wholesaler and retailer would rise causing a knock on effect to the consumer. Calculating and trying to offset the cost of the VED into all of those individual movement of goods is neigh on impossible.

 

Governments of all colours have to work towards tight inflation targets and as the cost of road fuel is included in the retail price index it would be a very brave political party who deliberately ramped up inflation.

 

As I have said, however, using the case of the 44tonner using 16tonnes of diesel a year, his saving in paying no road tax would outweigh his extra outlay in VED revenue being redistributed fairly as an extra tax per litre of fuel sold - by about 50%. Therefore, on a very simple level, the multiplier effects of road transport pricing would actually be positive - albeit in the real world asset management strategies in haulage may have to change.

 

The losers would be those with new cars - generally paying low double-digits VED but driving high mileages.

 

Don't forget you still have to add 20% VAT on top as well...

 

I appreciate that vat is paid on duty but but my extra duty would only be about 6.5p, the 2pish be the extra vat revenue - the idea being that the Gov't would raise the same revenue as under the current system - but via (imho) fairer true pricing of road usage.

 

EDIT - hmm the Olympics, a £12bn can of worms (which was promised to cost 2bn when we got it)

[Cavcraft]

They're just not going to twat people with new cars, that simply won't happen.

 

Diesel is only more expensive than petrol because so many people are running on it, years back it was cheaper than petrol because not many people wanted diesels.

[warren t claim]

We really need to move on to a system where we can print out our own tax discs and only have the facility to pay by the month if desired.

[warren t claim]

 

I'm against chucking the cost of road tax on fuel because everytime the government fancy another pointless war or Cameron and his wanker cronies want to throw thousands of disabled people on the dole, they'll just lob a few pence on a litre on an almost daily basis.

 

In all fairness Blair and Brown loved taxing fuel so much to fund their little Anglo-American crusade that they even brought the country to it's knees when people stood up to them and blocked refineries.

[Cavcraft]

Don't deny or disagree with that Wazzer old lad. The trouble is any measure taken by any government that starts bringing a nice few quid in for them is never likely to be reversed by any future parliaments so if we get taken to the cleaners by extra fuel duty and no RFL we're pretty much knackered forever.

 

I think we do still have the facility to print our own tax discs by the way, but with the advent of ANPR it just makes it harder!

[messerschmitt owner]

my motorhome costs £165 a year to tax

 

It is fixed almost permanently at that level and hasn't gone up since I bought the thing in 2004

 

shhhhhhhhhhhh