I am about to send this to my MP

ontheplane

Well-known member
Joined
20 Mar 2004
Messages
1,903
Location
Bristol UK
Visit site
Hi all,

I am about to send this to my MP - any (constructive) comments welcomed.

Thanks.


____________________________________________________________________

Dear Steve,

I would like to present the case for not increasing the Duty on Diesel fuel for recreational boat users in the UK. In the examples below, I have assumed that the rate might rise to the same as road diesel. As it is more expensive to get fuel to a Marina than it is to get it to a road garage, I will assume it were to rise to 3p above the current average Marina price for petrol (currently about £1 per litre).

I would like to base this case on 6 main points.

1. Current Legislation is actually correct:-
Currently here in the UK we enjoy what is described as the “Concession” of being allowed to use Red Diesel in boats, both “commercial” and “Recreational”. However this talk of “ending the concession” is a bit odd to me, because I understood that whether red or white diesel was used for vehicles depended on whether it was being used as “road fuel” or not. Thus, Farmers, who put red diesel in their tractors, are entitled to do so because a tractor is not primarily a road vehicle. Likewise forklift trucks in yard premises where not taken on the road, and finally boats because they are clearly not using red diesel as road fuel.

I remember this because there was an issue a few years ago where farmers were hauling sugar beet to the factory with the new generation of “fast” tractors (these tractors do 40mph) and Customs were questioning their right to use red diesel because the vehicles were primarily being used as road vehicles. The final argument came down (I think) to whether these tractors had standard field tyres or whether they had fitted “road tyres”.

So, to remove the so called “concession for boats” as far as I can see the government have to change the law such that it is not determined by vehicle use but by some other method. If they don’t then surely farmers (and fork lift trucks and trawlers and council grass cutting machinery and lorries on container ports etc………………) will also all have to use white diesel instead of red.
Clearly a boat is not a Road Vehicle and therefore Road Fuel Duty CANNOT be applied to it any more than it can to heating oil etc.

2. Administration of the Tax:-
If the government say all boats to use White Diesel it will kill our commercial fishing industry, ferry operators, small commercial boat operators etc. If they then decide only “leisure boats are to use white diesel” then I can see a ridiculous situation where people running boats will fit an Office Network on it pretty quickly with a special locker for the server and fax! “No Sir, not a leisure boat but a floating office”. Or perhaps everyone will carry a hamster – “No Sir not a leisure boat, but livestock shipment”, Perhaps a lump of coal “No sir – it’s a barge”, etc etc.

Having both Red and White Diesel on Marinas simply wouldn’t be possible as most are limited for space, so most marinas would have to make a decision which to stock creating an impossible situation.

This would then require marina operators to decide what vessels have a valid excuse for Commercial Diesel and which do not – almost impossible to apply.

3. Manufacturing:-
In the UK we have a small but healthy boatbuilding industry, one of the very few manufacturing industries we do have left. Large craft manufacturers such as Princess, Fairline, Sunseeker are all based in the UK, and export around 85% of their output – this contributes wonderfully to our balance of Trade, and indeed a massive contributor to local economies, bringing massive investment in plant, equipment etc not to mention jobs. These companies are usually based in coastal (and often otherwise deprived areas of the UK). It is fair to say that there would be a significant drop in the number of people buying a boat of this nature to use in this country should this happen. This loss of sales would result in a huge drop in the level of VAT collected on these sales, which (as I will explain in point 4) would more than outweigh the small increase to the treasury of a higher duty.

4. Negative increase in total duty collected:-
Put simply, increasing the Duty would actually REDUCE the amount of money collected by the Treasury. The super-rich already often boat outside of the UK due to better weather, cheaper berth prices etc. Those few super-rich who don’t keep their boats abroad would simply move them there as cheap flights become more and more readily available, thus spending less on fuel in the UK.

One of the biggest impacts would come from the medium-well-off. These owners often run a boat a few years old, and enjoy their quite expensive hobby. They choose to boat in the UK because once the boat is purchased, it isn’t too frightening to run. These owners would simply not be able to afford to boat any more, OR they would move their boating abroad. Without doubt some would stay, but they would limit the amount of cruising they did in order to keep the cost down.

The second major impact would be that of visiting boats. Currently, if your boat is based in Northern France etc, our diesel is cheaper than theirs. It is very common to see French, Jersey and Gurnsey based boats visiting our Marinas. These visitors spend money in our coastal resorts that often rely very heavily on the visiting boaters for much of their revenue during the season. Places from Dover to Plymouth are awash with visiting craft during the summer bringing much needed income to these areas. If Fuel costs trebled then these craft would only visit if their tanks were large enough to allow them to get to the UK and then home again without refuelling.

There would also be a huge reduction in the VAT and Tax collected from the purchases these visitors make in local shops, restaurants, bars etc – money which will simply go elsewhere. This applies to both the UK based owner who moves his boat abroad and visitors. The average family of 4 will normally spend well over £200 on a weekend to their boat. This re-distributes that wealth from (often) very wealthy areas of the country to the coastal regions (often the poorest). It is my view that towns such as Poole, Plymouth, Weymouth etc would suffer enormously from any large drop in wealthy visitors

My main point here is that unlike motorists, who being landlocked HAVE to buy their fuel here in the UK, Boaters have a choice – if the fuel is cheaper offshore then they will take their business there instead of here.

5. Employment:-
Thousands of jobs will be at risk if the Duty was increased. Not only some jobs in the Manufacture of boats, but also jobs at Marinas. Fewer boats in the UK means fewer staff are needed. Fewer staff at the myriad of industries around our coastline serving this massive industry, chandlers, engineers, repairers, etc. Jobs at coastal towns who thrive on the Marine users, restaurants, bars, clubs, etc.

6. Safety:-
There are a couple of safety issues here.

a) In order to take advantage of the cheaper fuel abroad, people will run their boats lower on fuel rather than fill up here in the UK. Many could risk trying to return to a home port in France or Jersey rather than pay extortionate UK prices. This means that the number of rescues that the Coastguard will be required to carry out will rise dramatically.

b) On small (under 35’) boats, the additional cost of diesel engines would no longer be worth it. This means that these boats would cease to be sold at all in the UK – or they would be sold with thirsty petrol engines, inherently more dangerous owing to the explosive nature of the fuel. The number of deaths and injuries from boat fires would increase sharply – witness the problem America has with boat fires.


So, my message for Gordon Brown is:

1. Leave red diesel law as it is (unless you are also taking on everybody else as well, don’t just stick the knife in to boaters).

2. Put 17.5% VAT on boat diesel if you must, that makes things a bit simpler and the increase wouldn’t be enough to drive the boaters abroad.

3. If you DO “harmonise” rates of duty here in the UK with Europe, don’t forget that if you raise the duty on Red Diesel, you will also have to lower the cost of Road fuel duty by around 80% - imagine the loss in revenue to the treasury.

4. The RYA may well launch an application that applying Road Duty to marine fuels is actually illegal?

5. Be prepared for the hidden cost. In certain parts of the country, the loss to tourism, manufacturing and the leisure industry will more than outweigh the revenue raised without taking into account the increased cost of redundancies. The Loss in VAT and corporation Tax on companies profits will certainly balance the increase in Duty raised.

6. The Marine industry automatically transfers wealth from the richest parts of the country ( you need to be quite wealthy to own a boat), such as London, Bristol, Birmingham etc and moves it to the Coastal regions such as North Wales, Cornwall, Devon, Dorset, Scotland. The boat owner will still spend this money – but they will spend it abroad.

7. Why do we have to pay the totally ridiculous pump prices we do for petrol for boats? Petrol is subject to road fuel duty, yet the boat never uses the road, and if it does then it’s use is paid for with the duty on the fuel on the towing vehicle. Many boat owners won’t pay the high prices in marinas for petrol, and thus most marinas won’t bother selling it. This leads to serious danger for many petrol boat owners who are on long passages and run out of fuel. It also means that most owners tow their boats full of fuel rather than keep them empty till they reach the sea. Thus if a boat is in a road Traffic accident then there is 30 gallons (or often more) of petrol for the emergency services to deal with. The cost to the treasury of providing coastguard services to the people who run out must easily match the revenue raised from the petrol at marinas. Why not introduce Red Petrol at Marinas around the UK. This would encourage the huge numbers of petrol boat owners along the coast to travel further, and would draw people over from France, Jersey, Guernsey etc bringing much needed income to our Coastal towns.


I hope this helps, but if you would like more information, please contact the Royal Yachting Association on




<hr width=100% size=1>Why can't we work 2 days a week and boat the other 5????
 

MaxJones

New member
Joined
25 Mar 2004
Messages
9
Location
South & West Wales, UK.
www.firstimpressionsmarine.com
You say ( you need to be quite wealthy to own a boat). Do you? That may be true on the south coast of England, but I live in Wales. My berthing costs are only a quarter of those down the rich south. Most of the boats around my marina are older types in the sub-£40,000 area. Look outside the 'wealthy' south coast and you find very few new boats. Most are third owner or more. Many owners I see are retired, living out a dream they can JUST manage. Others are younger, but suffer the same cash shortages. They try to escape the stress of modern life and stretch their finances to the limit. ANY increase in costs puts their pleasure at risk. At some stage there will be an accident, which will be atributed to lack of maintenance. When cash is short you do your own engine service, leave the water pump for another season, change the oil next year, make do with that old lifejacket and so on. The resulting loss to any local trading company is nothing compared to the cost of even one marine accident investigation, which would eat all that marine diesel tax money and more! The health benefit of an effective relaxation would be lost, at cost to the Health Service in increased treatments required. I have no doubt that brokers in Wales would find a lot of boats on the books with few enquiries and those that did enquire would not be prepared to offer the kind of premium price enjoyed by diesel over petrol at the moment. At a stroke, the value of a diesel boat would drop £5,000 - £10,000 even on quite modest vessels. These are the vessels owned by quite average people, on quite average wages, not wealthy south coast sailors. I think to describe boat owners as being wealthy, and then ask for a proposed tax increase to be dropped is a bit like shooting yourself in the foot. Better to use as an example the effect on the owner of a 10 or 20 year old boat. There are more of them about than those new(ish) cruisers we see in stranded on mudbanks in newspaper articles!
Have a safe and relaxing season.

<hr width=100% size=1>If compulsory training is such a good idea, why are there so many road accidents?
 

Dominic

New member
Joined
30 May 2002
Messages
255
Visit site
Good BUT Para 6

Great stuff but totally re-think para 6.

I am flat broke and lived on aboat for years, because I couldn´t afford a house.

<hr width=100% size=1>
 

robind

New member
Joined
23 Jul 2003
Messages
1,568
Location
sussex
Visit site
Copy of your letter gone to my MP for information Thanks!
Rob

<hr width=100% size=1><A target="_blank" HREF=http://www.rejuvanu.com>RejuVanu</A>
 
Top