The RYA and BMF welcomed Chancellor Gordon Brown’s announcement over red diesel in his budget statement today.

From 1 November 2008 fuel used for the purposes of private pleasure boating will no longer benefit from the current reduced and exempt rates of duty. In addition, a formal consultation on new regimes will be held later in the year.

The Chancellor’s decision means that the current infrastructure for diesel fuel storage and sale can remain in place until 1 November 2008.

Meanwhile, PBO’s ‘No road tax on boat fuel’ campaign is picking up speed with support from all sides of the industry.

No road tax on boat fuel
With the leisure boating industry turning over £2 billion a year and employing 30,000 people in the UK, a drastic hike in diesel duty would gain little in revenue (leisure boaters account for just 0.05% of the total amount of diesel burnt in the UK) while risking the health of a booming industry.

PBO is lobbying for a simple solution, whereby leisure boaters continue to fill up with diesel that is dyed red, (as it’s still legal for commercial users), yet pay a higher EU rate, keeping the receipts as proof. Otherwise, UK boaters will be stuck paying for the most heavily taxed diesel in Europe – UK ‘white’ road diesel.

Reactions to the chancellor’s statement today
“We welcome the decision to consult on the new regime and to keep existing arrangements in place during the consultation period” says the RYA’s Government Affairs Advisor, Neil Northmore, who has led the Association’s involvement in the campaign. “While Brussels’ original decision to end the derogation was disappointing, the UK Government has listened to our concerns.”

BMF Executive Director Howard Pridding commented “I am pleased that the Government has listened to our case for a lengthy transitional period in order for industry to manage the infrastructure changes that will be required. The implementation date of 1 November 2008 will give marine businesses the time to plan and budget for that change. We will continue to work with Government over the coming months as they develop the detail of the new legislation.”

For more on our campaign, buy the May issue of PBO, on sale 5 April