Red Diesel

[Deleted User YDKXO]

I don't think that is the case Mike. We pay full duty for all of our propulsion fuel, the 60% in the split (OK we all know that's nonsense). The EU say no-one can use marked fuel and if you read the recent email from the Belgium embassy, that's also what they say.

Yes we pay full duty on 60% of the fuel but the 60/40 split effectively means that total duty is less than road fuel which is the major problem. Yes, as I said, the EU thinks that private users shouldn't be using marked fuel but the major issue is the difference in duty rates

 

[gjgm]

Yes we pay full duty on 60% of the fuel but the 60/40 split effectively means that total duty is less than road fuel which is the major problem. Yes, as I said, the EU thinks that private users shouldn't be using marked fuel but the major issue is the difference in duty rates

I wonder what total annual leisure sales of red are in UK?
Say, given to a single days diesel usage in the nation?
The problem must be so miniscule you think EU might have something meaningful to employ it's time.
Sorry.. what am I saying...

 

[joliette]

I guess the politicians would point out that the only people that will see a significant extra cost are those that were using the current rules to evade tax. Personally I have no problem with tax evasion, but it does tend to catch up with you eventually.

So we're likely to see the end of 60/40 legitimate tax avoidance to eliminate the possibility of tax evasion by diesel boaters? Happily, with a petrol boat, it's not a cost increase that I'll need to deal with. Going forward, it seems to me that both diesel and petrol boaters are going to need better representation from the industry to address the 60% tax levy (plus any extra cost at the Marina pump) they will have to be pay for their fun!

 

[maby]

I wonder what total annual leisure sales of red are in UK?
Say, given to a single days diesel usage in the nation?
The problem must be so miniscule you think EU might have something meaningful to employ it's time.
Sorry.. what am I saying...

The trouble is that the directives on fuel taxation only consider the difference between use for propulsion and other uses such as heating or power generation. They do not distinguish between the types of vehicle being propelled. Even if the government wanted to, they do not have the freedom to give us reduced tax rates without also giving them to private car drivers - and hell will freeze over before they do that! The directives say that red diesel can only be used for propulsion by commercial users.

 

[Deleted User YDKXO]

The problem must be so miniscule you think EU might have something meaningful to employ it's time.

Yes you would think so but there's a whole army of overpaid, over expensed, over pensioned bureacrats over in Brussels with nothing better to do than interfere in individual countries' affairs. If we were like France or some other Club Med countries, we would simply ignore anything we didn't like but the irony is that the UK is the one of the best EU members in terms of observing EU regulations and diktats. Of course, it doesn't help that we have our own army of bureacrats in Westminster who's sole purpose is to interpret EU regulations and then burden us with them

 

[maby]

... If we were like France or some other Club Med countries, we would simply ignore anything we didn't like but the irony is that the UK is the one of the best EU members in terms of observing EU regulations and diktats. ..

What do you think we are doing? Trouble is that our freedom to ignore the directive becomes severely curtailed as soon as we cross the channel.

 

[Deleted User YDKXO]

What do you think we are doing? Trouble is that our freedom to ignore the directive becomes severely curtailed as soon as we cross the channel.

We are not ignoring the EU directive at all. The disagreement is over the interpretation of the directive, not the application of it

 

[maby]

We are not ignoring the EU directive at all. The disagreement is over the interpretation of the directive, not the application of it

It was never a defenceable interpretation of the directive! It was just a lawyer's trick of picking on imprecise language, the intent of the directive was always clear - sooner or later the commission would have got round to tightening it up, and the HMRC policy change is just a reflection of the fact that they could see they were going to lose the case soon - hence the rush to protect themselves.

The intent of the directive is to stop the non-commercial use of marked fuel for propulsion. It does not talk about taxation levels, just marking. If we had not offered that 60/40 split, it may have been easier to defend the concession, but too many boating vested interests wanted to continue with their cheap diesel.

 

[gjgm]

If we had not offered that 60/40 split, it may have been easier to defend the concession.

Please explain this part?

 

[Deleted User YDKXO]

It was never a defenceable interpretation of the directive!

Thats your opinion

The intent of the directive is to stop the non-commercial use of marked fuel for propulsion. It does not talk about taxation levels, just marking. If we had not offered that 60/40 split, it may have been easier to defend the concession, but too many boating vested interests wanted to continue with their cheap diesel

The reason the EU is not keen on using marked fuel for propulsion is to try to ensure that duty rates are the same for all fuel users and, as I said, the reason for that is to try to stop individual countries favouring specific industries with lower duty rates for competition reasons. The use of marked fuel is a problem but the crux of it is the different duty rate on it

 

[maby]

Please explain this part?

The intention of the marking directive is to stop non-commercial users benefiting from tax reduced (or tax free) fuel for propulsion. The theoretical justifiction for the 60/40 split is that it is pefectly legal to use tax rebated diesel for heating and power generation. The HMRC concession does not actually say that red diesel sold to leisure sailors will be taxed 60/40 - it says that when you purchase marked fuel, you can declare what proportion of it you are going to use for non-propulsion purposes and get that fraction of the tax rebated. HMRC suggested that a 60/40 split was a level at which they would not bother to check up on us - it is not mandatory. We purchased a tank of fuel in January and claimed 100% heating - saved about £40 - but the lock was closed, so we could not go anywhere and we had burned it all in the Webasto by mid-February.

The vast majority of users simply made a 60/40 declaration on every purchase irrespective of the time of year. The majority of these big motor boats are empty from October till March - why are they so concerned about preserving the 60/40 split. Even if you lived aboard the whole year round, the saving on fuel genuinely used for non-propulsion purposes is unlikely to be more than a couple of hundred pounds. It's an open secret that most of that tax rebate goes on fuel that is burned motoring round the coast and that is a contravention of the directive. Makes it a lot harder to defend, doesn't it?

 

[maby]

Thats your opinion


The reason the EU is not keen on using marked fuel for propulsion is to try to ensure that duty rates are the same for all fuel users and, as I said, the reason for that is to try to stop individual countries favouring specific industries with lower duty rates for competition reasons. The use of marked fuel is a problem but the crux of it is the different duty rate on it

True, but that does not alter the fact that the HMRC policy does not comply with the intent of the directive even if it is (possibly) consistent with the current wording. The commission intends that people like you and I should not be allowed to buy tax reduced fuel for propulsion. If we manage to argue that the current HMRC rules are consistent with the current directive, they will simply change the directive. You may manage to defend your rebate for another year, but sooner or later it will go, and in the meantime, our freedom to travel abroad is restricted.

 

[gjgm]

If we had not offered that 60/40 split, it may have been easier to defend the concession

I mean, what concession are we then left with to defend?

 

[gjgm]

True, but that does not alter the fact that the HMRC policy does not comply with the intent of the directive even if it is (possibly) consistent with the current wording. The commission intends that people like you and I should not be allowed to buy tax reduced fuel for propulsion.

Am I not declaring when I buy it, that to the best of my knowledge I am only buying 60pct for propulsion? (or 0pct or 10pct or...) So I am not breaking any directive?

 

[maby]

If we had not offered that 60/40 split, it may have been easier to defend the concession

I mean, what concession are we then left with to defend?

The concession that we can put red diesel into a tank that is connected to the engine - that is against the rules.

 

[maby]

Am I not declaring when I buy it, that to the best of my knowledge I am only buying 60pct for propulsion? (or 0pct or 10pct or...) So I am not breaking any directive?

The intent of the directive is that no marked diesel should enter your engine. The directive does not talk about tax levels, though the link is implicit through other parts of the rule book. The directive we are being hit with exists to define the mechanism that allows member states to reliably police the separate taxation rules.

 

[gjgm]

The concession that we can put red diesel into a tank that is connected to the engine - that is against the rules.

The 60/40 came after the derugation ended? There wasnt anything left to defend by that point. EU said they had already given 12 years +2 more (I think)of fiddling about.
Unless you are making some odd differentiation between red in a propulsion fuel tank, but not used for propulsion-which isnt making much sense to me.

 

[ian38_39]

there is nothing at all to stop you buying fuel at a lower rate than UK road fuel.

EU regulations only specify a minimum level of duty, our government sets the duty rate as this is a local tax, as long as it is above the EU minimum then that is fine. UK Gov being the good sole that it is sets our duty rate considerably above the EU minimum and as such could if they wanted to sell marine diesel (white road diesel for marine use) at 100% tax but with the tax set at the EU minimum. It won't because we would all then run our cars on it, either directly by filling jerry cans at the marina or indirectly and without knowledge through criminal types who would feed it into the supply chain.

The issue is purely that it has a dye in it, it is easy to see why EU members would want to stop red. It is red dye that they mark there duty free fuel for commercial use with, unidentifiable from UK duty paid red diesel and a nightmare for them to keep out of their own home leisure boats if it can be bought legally in the UK.

Adopting Irelands Green diesel idea would technically solve the problems. Green diesel is not available in any other EU country so no one could continue to fill up with it.

The UK could set the minimum EU specified tax on the fuel, getting rid of the 60/40 issue as it would be 100% taxed at an agreed EU rate.

Commercial could have a dispensation to fill up with Green Duty free, thus meaning we only need one set of tanks at the marina.

No more chance of it being used on UK roads than that of red.

All it needs is some faceless EMP to rub shoulders with a few mates, agree to chuck them a few extra herring in the next vote and all the problems are solved at once.

 

[PaulGooch]

Am I not declaring when I buy it, that to the best of my knowledge I am only buying 60pct for propulsion? (or 0pct or 10pct or...) So I am not breaking any directive?

Yes you are. You are breaking the directive that says you cannot use marked (red) fuel. That's what the current issue is all about, nothing to do with duty or the 60/40 split.

 

[PaulGooch]

there is nothing at all to stop you buying fuel at a lower rate than UK road fuel.

EU regulations only specify a minimum level of duty, our government sets the duty rate as this is a local tax, as long as it is above the EU minimum then that is fine. UK Gov being the good sole that it is sets our duty rate considerably above the EU minimum and as such could if they wanted to sell marine diesel (white road diesel for marine use) at 100% tax but with the tax set at the EU minimum. It won't because we would all then run our cars on it, either directly by filling jerry cans at the marina or indirectly and without knowledge through criminal types who would feed it into the supply chain.

The issue is purely that it has a dye in it, it is easy to see why EU members would want to stop red. It is red dye that they mark there duty free fuel for commercial use with, unidentifiable from UK duty paid red diesel and a nightmare for them to keep out of their own home leisure boats if it can be bought legally in the UK.

Adopting Irelands Green diesel idea would technically solve the problems. Green diesel is not available in any other EU country so no one could continue to fill up with it.

The UK could set the minimum EU specified tax on the fuel, getting rid of the 60/40 issue as it would be 100% taxed at an agreed EU rate.

Commercial could have a dispensation to fill up with Green Duty free, thus meaning we only need one set of tanks at the marina.

No more chance of it being used on UK roads than that of red.

All it needs is some faceless EMP to rub shoulders with a few mates, agree to chuck them a few extra herring in the next vote and all the problems are solved at once.

That's a totally ridiculous suggestion Ian.



Involves far too much common sense to ever be implemented