The Chancellor of the Exchequer, Rishi Sunak, today froze fuel duty at its current rate (03 March 2021).
The freeze will help drivers during the recovery post-pandemic as they start returning to work, with many likely to favour personal transport over using public transport, especially as fuel prices have been creeping upwards. The RAC’s most recent fuel report said that that fuel had risen 2p per litre on average.
However, there was little sign so far of any movement on greener transport incentives. Lex Autolease’s Ashley Barnett commented:
An alternatively-fuelled future simply can’t happen overnight. The affordability of EVs is a key barrier towards mass adoption and for some people, an ICE vehicle remains their only option. Against the backdrop of the pandemic, many people are still using cars as a safer mode of transport and any rises would feel counterproductive at this moment in time. As momentum continues to shift away from petrol and diesel, a future rise in the 10-year fuel duty freeze feels inevitable and will help fund investment in greener alternatives.
Ashley Barnett, head of fleet consultancy, Lex Autolease
An earlier pre-Budget submission by the BVRLA had called for three critical measures to support the fleet sector’s recovery and to help accelerate the move to a net-zero road transport system:
- A one-year freeze in Vehicle Excise Duty (VED)
- “Lock in” the previously announced Benefit-in-Kind freeze and publish 2025-26 rates
- Create a ‘Green Investment Allowance’ to unlock private investment in electric vehicle charging
It appears the Chancellor has not acted on these requirements for the fleet sector from the BVRLA, although Broker News has not yet had sight of the finer detail of the Budget submission.
Ralph Morton is the leading journalist in the leasing broker sector and editor of Broker News, the website which provides information and news for BVRLA-registered leasing brokers. He also writes extensively on the fleet and leasing market in both the UK and Europe.
