Red diesel decision is in: full rate at pump from November

[Dyflin]

Red diesel decision is in: full rate at pump from November
The decision is this: red diesel is staying red, but boaters will have to pay the top rate of duty (54.68 pence per litre instead of 7.69ppl) at the pump from 1 November this year.

Boaters, therefore, can expect to see prices for a litre of diesel shoot to well over £1 from November.

This also means that the fuel vendor is handed the responsibility of differentiating between commercial users, who will remain legally allowed to use red, and leisure users.

The news came through today from HM Revenue & Customs, with the following wording: "Private pleasure vessels will continue to be permitted to use marked (red diesel) but at a rate for heavy oil, repaying the rebated duty via the Registered Dealers in Controlled Oils who will declare this to HMRC. An allowance for domestic use will be permitted."

Boiled down into plain English - full whack at the pump, but leisure users may declare that they intend to use a certain proportion of their tank of red for heating, or other "domestic uses".

MBM will be updating this story as further details emerge.


Motor Boats Monthly, 28 February 2008

 

[Nickcf]

Also assume VAT will increase from 5% to 17.5%? This will mean a marina price of between £1.20 and £1.30 per litre. This will be a killer for the leisure boating industry.

What a bunch of tossers this gov is..... They originally said they couldn't just apply the minimum rate of duty required (about 20p per litre under EU rules) as they couldn't have two rates of tax for the same fuel (ie white diesel). Haven't they just done precisely that with red?

 

[jmmt]

But it's not just the Gov that are a bunch of tossers - it's the RYA and the British Boat Federation for agreeing with them on our behalf! It's clear "they" went for the first priority of getting the Gov to agree to keep Red Diesel as it makes life much easier for the fuel vendors. It actually makes life easier for all of us including the Gov BUT "they" should have been a lot tougher on getting the quid pro quo of keeping the duty down to 20% and the VAT at 5%. That alone would have been a substantial burden for us to pay. But oh no - just roll over and stiff us for the maximum duty and the maximum VAT. Nickcf is correct - it will be a killer for the leisure boat industry. Imagine coughing up say 200 x £1.25 = £250 just for a modest tank refill on a modest single engine boat say 20 times a year in a modest season in the Solent where your berthing fees are about £5000 / year. This looks to me about £10,000 year out of taxed income...and "they" say it won't make that much difference and it will be Carry on Boating! Well I know what I am going to do...

 

[rubberduck]

I think any concessions for relatively well off boat owners are a thing of the past. What everyone should concentrate on now is the cost of fuel in the UK in comparison with the continent. /forums/images/graemlins/mad.gif

 

[halcyon]

Is it a no win situation ? with the pound heading for a 1 euro to the pound, not even a I'll nip over the channel will work.

At least we will be paying the same per litre.

Brian

 

[jmmt]

Re: Carry on Boating - I don\'t think so!

Well Rubberduck it depends what you mean by "relatively well off boat owners". I read a survey the other day that put 77% motor boat owners in the over 55 category. Now it's most unlikely that any of these individuals are still in full employment - some may well be - but the vast majority will be pensioners of either the company, state, maybe both and others just scraping along just keeping things together and enjoying their boats. And then along comes a HUGE and unbudgeted increase in diesel costs! Are they the "relatively well off boat owners" you are referring to Mr Rubberduck?

 

[Whitelighter]

Re: Carry on Boating - I don\'t think so!

It has been coming since we last had the degrodation extended 5 years ago. I didnt want to pay the extra, and I am not rich, but to say the rise was unbudgeted points to the blind, the stupid or the ignorant.

 

[Whitelighter]

[ QUOTE ]
Imagine coughing up say 200 x £1.25 = £250 just for a modest tank refill on a modest single engine boat say 20 times a year in a modest season in the Solent where your berthing fees are about £5000 / year.

[/ QUOTE ]

Hang on - I would suggest that someone who uses 4000 litres a year in a modest boat is far from an average user. I have a modest boat, and that much fuel would get me over 4,000nm which I am never going to do.

Anyway, even if red stays you are paying £7500 a year as is. Never mind the costs of servicing the engine, updating/fixing stuff, and the depreciation/loss of interest on the capital invested. Real costs I reckon you can add another £5000 to that figure easily, so for your 4000 miles a year (I still argue this is way more than most) the fuel increase is going to add 20% to yopur costs.

 

[jmmt]

Re: Carry on Boating - I don\'t think so!

"but to say the rise was unbudgeted points to the blind, the stupid or the ignorant."

A little harsh on me I think Jez considering that a) we have never even been introduced and b) I wasn't in this boating malarky 5 years ago so knew nothing about the background! So for me Jez it is unbudgeted - OK?

Just say your numbers are better than mine and I think they are and fuel is going to cost me 20% more next year and so on up for ever afterwards. You also note all the other fixed and variable costs which I also agree with and soon you are looking at close to £10000 out of taxable income to run a 10m boat in the Solent. Sure there are a lot of big spenders out there in their Sunseekers and Princesses and just don't care how much it costs to diesel up but they are not the majority.

So it is a behaviour changing tax increase and it is going to make a big difference to the boating community. It's clear that these tossers in the UK Government want to stiff us up bigtime and at the moment they call the shots...

Wake up boaters and smell the diesel...

 

[Whitelighter]

Re: Carry on Boating - I don\'t think so!

Its true I've not met you, and I was not into boating on my own until 2004 either, yet I was well aware. Maybe I read a bit more, I dont know.

also, it waont cost 20% more year on year, next year is a big hike, after that it is down to the cost of oil. I cant say which way that will go, there are masses of untapped reserves that up till now have been uneconomical to extract. With crude over $100 a barrel these become economic prospects, so crude should stabalise or even fall back a bit.

I guess my point was, if you are boating on the limit of your earnings now, sooner or later inflation would make it uneconomic for you anyway. Have you considered reducing your costs in other areas? I had my 9m mobo on a swinging mooring in my first year to save costs - £1600/year against £3900 in a marina. Perhaps less eating out and more BBQ's on the beach is an option, or an overnight in Newtown Creek rather than on a pontoon at Lymington?

Maybe you do all this already - I dont know. But for anyone to be soo close to the break point seems a little fool hardy in the first instance...

 

[jmmt]

Re: Carry on Boating - I don\'t think so!

Well now Jez so now I've been described as blind, stupid, arrogant, foolhardy and now close to breaking point! Phew that's quite a list of attributes of one kind or another and we've never even met! I see you are a boat dealer at Sparkes so, as a professional, you probably know what you are talking about when it comes to boats and the people who buy them. You must also be aware of the survey I mentioned in an earlier post that had a very high percentage of boaters in the retired or semi retired bracket who may or probably not have indexlinked incomes that will keep up with this Governments stated objective of changing behaviour amongst all hydrocarbon users. As you know this is independent of how much undiscovered reserves of crude that you seem to have an inside track on. The Government will "Keep on Taxing" and this means that "Carry on Boating" is going to get progressively very expensive indeed!

 

[Nickcf]

Re: Carry on Boating - I don\'t think so!

I think the issue for many boaters will be whether it is just worth the money in the future.
My boat easily gets through 80 litres an hour and whilst I probably could afford running costs of £120 per hour I don't think this represents a good use of my cash. When a return trip, Dover- Calais, is going to cost well over £300 in fuel alone I won't be doing many of those in the future!

There comes a point with any activity when the costs outweigh the benefits. I think power boats will have reached that stage by 2009 for many people- unless you are one of the super rich who just don't care

 

[Whitelighter]

Re: Carry on Boating - I don\'t think so!

OK, look. I have clearly rubbed you up the wrong way for which I appologise. I am not looking for a fight, nor do I wish to argue with you.

From my point of view I will also have to cut back on some of the stuff I do to allow me to pay for the additional fuel. I wont be pleasant but I have to make do if I want to keep enjoying a past time which is dear to me.

I am sorry if the cost of diesel will stop you boating, truely I am - but I really never saw it was going to end any other way. We could never lobby or make a fuss as the 95% of the country who dont have a boat would have cried out that we should have been getting cheap diesel for so long to fund this rich mans sport.

 

[Sneds]

Re: Carry on Boating - I don\'t think so!

Have to agree with you ...... no-one would ever support our claim to "cheap fuel"
When I mentioned it in the office peeps were surprised that we paid only 55p per litre, and claimed it was outrageous that they subsidised our hobby.
This coming from people with kids that command child benefit and company cars that they fuel up for free!
Do they offer "petrol money" when they come out for a ride? Do they hell!
Viva la revolution I say!
We sacrifice quite a few other luxeries to have our boat, but that, I guess, is our choice.

PS a bit pi55ed!! /forums/images/graemlins/grin.gif /forums/images/graemlins/grin.gif

 

[adrianm]

[ QUOTE ]
I think any concessions for relatively well off boat owners are a thing of the past. What everyone should concentrate on now is the cost of fuel in the UK in comparison with the continent. /forums/images/graemlins/mad.gif

[/ QUOTE ]

Exactly. I never understand why anyone ever tried to fight this from the point of view of keeping the derogation. It should have been fought from the "why should we pay road duty prices".

I cancelled my RYA membership after they decided most of their members wanted the price rise.

 

[rickp]

[ QUOTE ]
I cancelled my RYA membership after they decided most of their members wanted the price rise.

[/ QUOTE ]

Did they say that?

Rick

 

[alan17]

Re: Carry on Boating - I don\'t think so!

I will carry on boating but I will not be continuing my membership of the RYA. The RYA is supposed to fight for and on behalf of the boating community. In my opinion they have done very little and just caved in. It seems to me that the RYA are just looking after their own interests and not boaters in general.

 

[Sneds]

Re: Carry on Boating - I don\'t think so!

Here here!

 

[Andrew_Fanner]

Re: Carry on Boating - I don\'t think so!

RYA = Racing (sailing) Yacht Association

 

[jmmt]

Re: Carry on Boating - I don\'t think so!

[ QUOTE ]
I cant say which way that will go, there are masses of untapped reserves that up till now have been uneconomical to extract. With crude over $100 a barrel these become economic prospects, so crude should stabalise or even fall back a bit.

[/ QUOTE ]

Bad news Jez!
We had an oil analyst down here in Cape Town this week who made a public statement at the Oil Africa conference that "the world is within about 1200 days of reaching maximum crude oil production - say mid-2011".

Blimey Jez - less time than we thought!