"Replace fuel duty shortfall by general taxation" – Report
A new report commissioned by the RAC Foundation suggests that the Treasury will need to make up a shortfall in fuel duty caused by more efficient cars. The Association of British Drivers suggests that drivers are subsidising general taxation by far too much already and that redressing this imbalance should be the priority.
ABD Chairman Brian Gregory comments: “For decades the cross subsidy from road users into the overall revenue take has increased steadily. We are now at the point where drivers contribute around £48 billion per annum in taxes but less than £10 billion is spent improving and maintaining the roads. Instead of increasing fuel duty or introducing other charging methods to cover the shortfall, the Treasury should be looking to redress the balance by lowering charges to drivers. Mobility is vital to economic recovery and lower fuel prices would reduce costs to businesses and individuals. Consumers would have more money to spend and the consequent economic growth would create a net gain to the Treasury over time.”