Red Diesel

[AdeOlly]

Where is 'here' to you?


Red on the South Coast sells at 85p/litre before duty, £1.35 after at 100% duty, £1.15 at 60%

The price of white out of the refinery pre duty is currently within a penny of red.

Just to muddy the waters, red qualifies for VAT @ 5%, n'est pas? I bet whilte at 100% will qualify for VAT @ 20%. So the £1.35 easily become £1.50+

 

[ian38_39]

If Tesco's sell it for £1.45 marinas anywhere other than the huge turnover outlets on the south coat will be at least 10p more.

 

[ian38_39]

As I said the directive stated that we could not charge a different rate of duty for the same fuel.

QUOTE]
I dont think that is correct. I think the directive says that a country cannot have different taxations levels for the same fuel for the same use.
IE fuel for heating can be taxed differently from propulsion, but propulsion is propulsion.

ULSD with no bio is formulated especially for marine use, as such it is a different fuel and can be taxed at the minimum rate. The problem is it will also run cars so HMRC are only going to allow it if it is marked. Once it is marked you fall foul of the marked diesel situation, hence the need for a separate class within the EU fuel directive and from my limited experience with EU classifications that is not going to be easy but the only alternative I can see to that is to get red reclassified as a different fuel to white. unfortunately that will also run cars and has the added disadvantage of being the same colour as all the other EU countries duty free fuel.

 

[Lotus_John]

ULSD with no bio is formulated especially for marine use,

I absolutely agree it was different in 2008 and it is different now, it should have been taxed as a different fuel and at the EU minimum low rate. Unfortunately it would have been easier to do this when we lost the derogation instead of now, after accepting it is the same fuel as road fuel by charging the same level of tax for the last 4 years.

 

[BlueSkyNick]

I'm on the East Coast.

You're claiming that where it available, white "marine" diesel would be £1.35. I don't believe that would be the case. Red here is currently more than that, for one thing. For another, white road fuel is also more than that.

Can anyone really see white diesel in marinas being cheaper than Tesco's ?

With respect, you are missing my point Paul.

The difference in duty between between 60% and 100% is only 19p at current rates, not a 50% increase in cost as was indicated earlier in this thread.

However, AdeOlly makes a good point - I will need to check what the VAT rate is going to be.

 

[Garold]

I'd be quite happy if Tesco started a marine fuel station on the south coast. Serving normal, Belgian approved diesel.

Prob be a good price, and you could pick up fresh milk and bread at the same time.

Maybe when they get fed up of Tesco Metro.

Tesco Marine has a ring to it.

G

 

[timbartlett]

... 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

I'm sorry, but in most cases that I have come across (red diesel is a significant exception) EU Directives make complete sense.
Unfortunately, the UK either ignores them or (more often, I believe) gold-plates them, making them expensive and impractical.
Having done so, the government then spreads the word that it is all the EU's fault.

To some extent, the diesel situation is the same. The only reason we have a problem at all is because the UK government imposes duty at more that twice the EU so-called "harmonised" rate (see http://ec.europa.eu/taxation_custom.../excise_duties-part_ii_energy_products_en.pdf:-

Harmonised rate = E330 per 1000L
Belgian rate = E442.688 per 1000L
UK rate = E674.15 per 1000L (approx -- depends on exchange rate)

Even our red diesel is subject to typical UK Government greed at more than six times the level of duty specified by the "harmonised" rate:-

Harmonised rate = E21 per 1000L
Belgian rate = E21 per 1000L
UK rate = E129.59 per 1000L (approx -- depends on exchange rate)

And then there's the VAT.

 

[gjgm]

With respect, you are missing my point Paul.

The difference in duty between between 60% and 100% is only 19p at current rates, not a 50% increase in cost as was indicated earlier in this thread.

However, AdeOlly makes a good point - I will need to check what the VAT rate is going to be.

You pay 5pct on heating fuel,20pct on propulsion.

 

[PaulGooch]

You pay 5pct on heating fuel,20pct on propulsion.

Not at the moment you don't, it's 5% on both.

 

[PaulGooch]

With respect, you are missing my point Paul.

The difference in duty between between 60% and 100% is only 19p at current rates, not a 50% increase in cost as was indicated earlier in this thread.

However, AdeOlly makes a good point - I will need to check what the VAT rate is going to be.

I did get your point Nick, but with respect too, i didn't agree with your figures.

You say that you're selling red at the 60/40 split for £1.15 ?

How much are you selling red for with full duty ?

I don't agree that marinas would sell white for £1.35, that would be less than forecourt prices. Marinas are usually more expensive than the forecourts, so i'd expect them to charge at least £1.50 per litre for white.

I do agree though, that even that isn't a 50% rise, although it's significant.

 

[sailorman]

I'd be quite happy if Tesco started a marine fuel station on the south coast. Serving normal, Belgian approved diesel.

Prob be a good price, and you could pick up fresh milk and bread at the same time.

Maybe when they get fed up of Tesco Metro.

Tesco Marine has a ring to it.

G

Asda be done

 

[Deleted User YDKXO]

To some extent, the diesel situation is the same. The only reason we have a problem at all is because the UK government imposes duty at more that twice the EU so-called "harmonised" rate

I said that the high cost of road diesel is the real problem in one of my other posts but the UK is indeed particularly rigorous about translating EU directives into UK law and then applying them in a draconian manner as any businessman will tell you. I do have first hand experience of how blindly the UK observes EU directives in my own industry and how other EU countries just pay lip service to them. In that sense, the UK is the most loyal member that the EU has

 

[AdeOlly]

You pay 5pct on heating fuel,20pct on propulsion.

Nope, it's 5% on both. It was a last minute concession by HMRC when the 60/40 thing was brought in. Can't see that lasting if red becomes white

 

[ian38_39]

I think that was the point being made, if we do go to white it will be 20% instead of the 5% vat charged now. Hence it will not be 19p more but more like 10% above forcourt price, about £1.60 at todays prices.

 

[TrueBlue]

I think that was the point being made, if we do go to white it will be 20% instead of the 5% vat charged now. Hence it will not be 19p more but more like 10% above forcourt price, about £1.60 at todays prices.

Methinks it'll be a tad more than that because the seller has to bear the cost of the duty element up front on delivery. So he'll want a return on that working capital as well My guess is around £1.70 and those folk who can will resort to jerrycans...

 

[ian38_39]

Guess it will depend on where you buy your fuel and what the turnover is but we can buy petrol waterside at anything from 10p above road to 60p above.

 

[Nick_H]

A new slant on the issue from the RYA:

"Notwithstanding the contradictory assertions in the Minister’s statement and HMRC’s consultation documents, the draft legislation appended to the consultation documents would not in fact make it unlawful to use marked diesel outside UK waters. Instead, the proposal is to change the content of the required declaration when purchasing fuel.

The proposed legislation would not therefore change the current situation if you go to Europe.

However, the proposed revised content of the declaration does not accurately reflec! t the position under either UK or international law and thus would effectively require signatories falsely to acknowledge that they are aware of restrictions on fuel usage that do not in fact exist.

The RYA is therefore challenging this proposal.
Gus Lewis, Head of Legal & Government Affairs"

 

[maby]

A new slant on the issue from the RYA:

"Notwithstanding the contradictory assertions in the Minister’s statement and HMRC’s consultation documents, the draft legislation appended to the consultation documents would not in fact make it unlawful to use marked diesel outside UK waters. Instead, the proposal is to change the content of the required declaration when purchasing fuel.

The proposed legislation would not therefore change the current situation if you go to Europe.

However, the proposed revised content of the declaration does not accurately reflec! t the position under either UK or international law and thus would effectively require signatories falsely to acknowledge that they are aware of restrictions on fuel usage that do not in fact exist.

The RYA is therefore challenging this proposal.
Gus Lewis, Head of Legal & Government Affairs"

Once again, peeing around with words rather than addressing the real problem...

 

[joliette]

... and thus would effectively require signatories falsely to acknowledge that they are aware of restrictions on fuel usage that do not in fact exist.QUOTE]

Sounds just like 60/40 tax avoidance (or should I say evasion) to me! Does someone need to tell the RYA that when in a hole one should stop digging?!

 

[AdeOlly]

Sounds just like 60/40 tax avoidance (or should I say evasion) to me! Does someone need to tell the RYA that when in a hole one should stop digging?!

60/40 is HMRC's suggestion and the split scheme. Doesn't sound like avoidance or evasion to me. If it was why aren't there strings of peoploe lined up to be prosecuted? After all, our name and address is on every blooming declaration. QED.